The poles aren’t like the rest of Europeans. They’re more old school, a hard people who find difficulties in changing light bulbs with less than 10 people. Their central bank chief, Jerzy Kropiwnicki just gave short sellers open season on the Polish currency, which has a long rich history of fuckery.
The currency slid 0.4 percent to a three-week low of 4.4295 per euro, adding to a 0.8 percent slump yesterday after Polish central banker Jerzy Kropiwnicki suggested that after a vote for Brexit, he would tolerate a slump to a record 5 per euro before intervening. The yield premium on the nation’s 10-year domestic bonds over Germany jumped to 326 basis points, the most since 2012.
“We identify the zloty as one of the most vulnerable currencies to Brexit risks,” ING Groep NV strategists Chris Turner and Petr Krpata wrote in a report to clients. “In such an environment, yesterday’s comments from the MPC board member Kropiwnicki are not helpful.”
Brexit concerns are hurting the zloty, which plummeted to a record intraday low of 4.93 per euro during the global financial crisis in 2009, because the Polish economy is the largest recipient of EU subsidies which could partly be at risk if the U.K. exited. The pound and European stocks extended losses on Tuesday after a series of new opinion polls showed Brits may vote to leave.
Since the euro is in the deflationary vortex, by extension, Poland is not. Hence, her currency waivers, as the Germans dig themselves a deeper trench.
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Ranks up there with former financial mastermind Gordon Browne telling the entire world he was going to unload the bulk of the UK’s gold reserves. That fuckhead went so far as to say when he was going to do it and what price they would try to get.
No front-running was done, I’m sure because that wouldn’t be nice.