The market has almost ignored the inflation numbers over the last two days within the Central and Eastern Europe (CEE) region and the global story seems to be in the spotlight still, ING’s FX analyst Frantisek Taborsky notes.

Declining EUR/USD can keep pressure on the CEE currencies

“Today will not be much different. The calendar offers current account numbers for September in Poland, the Czech Republic and Romania. Those produced a positive surprise last month in the Czech Republic and a negative one in Poland, which the market could watch this time around to see if it was a one-off or a trend reversal.”

“However, the main story remains the declining EUR/USD which should keep pressure on the CEE currencies. We remain bearish here. If anything we see PLN outperforming the region but perhaps later rather than sooner, however yesterday EUR/PLN bounced off 4.360 which seems like a key level.”

“While HUF seems like a separate story now PLN/CZK may get the market's attention given the bounce back from 5.800 which seems like a limit to PLN's weakness here and could get some support.”