Analyst at Danske Bank Kristoffer Lomholt remains cautious on the outlook for the Polish currency. Key Quotes “In Poland, the PLN strengthened further as PMI numbers released yesterday pointed to continuing strong growth in the Polish economy”. “The currency has now gained 3.5% against the EUR since the political turmoil in mid-January. Will the CEE currencies continue to trade strongly? They may well if the strong economic growth continues in these economies”. “In the case of the PLN, we remain cautious, however, about the possible flaring up of the conflict between the EU and Poland over the constitutional court issue in Poland”. “A negative EU verdict could weigh on the PLN. The EU’s Venice commission has delivered its report to the Polish authorities and is waiting for the Polish government reaction before coming up with its recommendation”. “Hence, we stick to our 1M and 3M forecasts for EUR/PLN at 4.45 and 4.40, respectively, but we do see significant downside risks if the political risk is contained”. For more information, read our latest forex news.