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Polish Leader Voices Concern About Zloty
Prime Minister Marek Belka expressed concern Thursday about the Polish zloty's rise against the U.S. dollar and the euro, and said he planned to discuss it with central bank officials.
The zloty has risen 17.3 percent against the dollar and 11.1 percent against the euro this year, raising fears that its strength could dampen Poland's export-driven economic growth.
"The zloty's appreciation raises the concern of the government and the central bank," Belka said.
He said he would meet soon with Polish central bank officials to discuss "measures that can be taken given the very fast appreciation of the zloty in the last few months."
But Economy Minister Jerzy Hausner said later Thursday he sees no "no reasons for immediate concern" and indicated that he opposes having the Polish central bank intervene to dampen the zloty's rise, which it could do for instance by selling zlotys.
Analysts say the zloty has strengthened because of Poland's recent economic recovery and because the country has become a more attractive place to invest since it joined the European Union on May 1.
"We have a free market rate," Hausner said in the southern city of Katowice. "I do not think the rate mechanism should be changed, I do not think the central bank has at its disposal easy and simple methods which could stop the trend."
Poland also benefits from the weak dollar because it lowers prices of oil and gas, which are traded in U.S. dollars.
"There are certain instruments which could be used if we were really afraid that the zloty's strengthening will threaten exports and growth, but ... it is too early now," Hausner said.
The zloty traded Thursday at US$3.1196 and euro4.1607.
Source: Forbes.com |
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