What's takeaway 1 on EUR/PLN and USD/PLN price forecast for 2026, as per UBS?

UBS anticipates weaker PLN against EUR and USD through 2026.

What's takeaway 2 on EUR/PLN and USD/PLN price forecast for 2026, as per UBS?

Market sentiment is influenced by Poland's inflation and monetary policy.

What are the market implications for EUR/PLN and USD/PLN price forecast for 2026, as per UBS?

Traders should watch for any signs of inflation data releases in Poland that might influence the NBP's next rate decision. Should the EUR/PLN approach levels above 1.10, it could signal further shifts in sentiment towards the PLN.

What are the risks to this view on EUR/PLN and USD/PLN price forecast for 2026, as per UBS?

A significant risk to the PLN depreciation outlook would arise if the NBP adopts a more hawkish stance than anticipated, perhaps due to unexpectedly low inflation figures or robust economic growth indicators compelling a shift in their current policy framework.

EUR/PLN and USD/PLN price forecast for 2026, as per UBS - Investing.com UK

The desk anticipates that both EUR/PLN and USD/PLN will experience notable price movements through 2026, as projected by UBS in their latest analysis. Per the full note source, the expected economic backdrop will be influenced by Poland's monetary policy stance and broader regional economic health. The desk highlights that while UBS has not provided specific numerical targets in the source, market sentiment and analyses suggest a bearish outlook towards the PLN stemming from potential interest rate adjustments by the National Bank of Poland (NBP). Underpinning this forecast, analysts are closely observing Poland's inflation dynamics and economic recovery post-pandemic, alongside fluctuations in global risk sentiment which could affect PLN's valuation.

What the desk is arguing

The desk frames this as a pivotal point for both EUR/PLN and USD/PLN moving towards the latter half of the decade. As per UBS, the expected interest rate path of the NBP could drive further weakening of the PLN against key currencies like the EUR and USD, especially if inflationary pressures continue to exceed targets.

In terms of evidence, the economy is poised for substantial challenges, particularly if the external backdrop remains uncertain, which aligns with UBS’s cautionary take. The potential for rate hikes elsewhere, combined with Poland's typically higher inflation relative to peers, adds to the downward pressure we might see on the PLN.

Where it sits in our coverage

Currently, our consensus target for EUR/PLN stands at 1.075, with a range spanning from 1.04 to 1.12. Aligning with our outlook, jpmorgan is targeting 1.10 for March 2026, while bofa forecasts a more conservative 1.04 in the same timeframe.

This view of the desk is somewhat balanced, yet rests at the mid-point of various forecasts within the current range, suggesting a cautiously optimistic approach towards the PLN’s depreciation over the outlook period.

How other firms see it

Several firms, including jpmorgan, are aligned with the desk's bearish view on PLN, indicating a shared sentiment regarding the potential for weakness against both EUR and USD. In contrast, bofa appears as a contrary firm to this outlook, positioning for less depreciation of the PLN than their peers.

Market watchers should also look at related currency pairs, such as EUR/USD and GBP/PLN, to better gauge how fluctuations in regional central banks’ monetary policies could consequently impact PLN's trajectory, particularly influenced by ECB’s rate decisions.

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