The Polish zloty looks unlikely to hold recent gains. Economists at ING expect to see another wave of PLN selling in late August/early September.

NBP to reluctantly continue its hiking cycle

“The fundamentals are unchanged, ie, a high risk of a recession in Europe and significantly softened NBP rhetoric. This may trigger another wave of PLN selling in late August/early September.” 

“Longer term prospects of the zloty largely hinge on general CEE sentiment and the dollar (negative correlation of CEE FX and USD has been particularly strong this year).”

“We expect the NBP to reluctantly continue its hiking cycle, offering some support for the zloty, particularly when key central banks end their cycles.”