– China’s non manufacturing PMI fell
– Australia posted a bigger than expected trade deficit in August
– We expect the Polish central bank to be on hold, against consensus for a cut
What to watch for today
PLN: On hold. Our economist expects the Polish central bank to keep rates on hold on Wednesday, in contrast to Bloomberg consensus for a 25bps cut. While the Bloomberg survey is somewhat split with 8 out of 35 economists expecting rates on hold, the market appears to have fully priced a 25bps cut and it is set for another two cuts this year. We believe this will prove too aggressive, with inflation and growth likely to moderate only slowly. We expect a positive reaction to an on hold’ decision and we continue to hold a long PLNHUF recommendation in our model cash portfolio.
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