Market Summary by AFORTI: Approval of peace plan, CIT for banks, good macroeconomic data from Poland

2025-12-01

Last week, key developments included reports that Ukraine had accepted the Trump administration's peace proposal and the introduction of a higher CIT tax for banks, which coincided with surprisingly good macroeconomic data from Poland. In the asset markets, the WIG Index and the price of Bitcoin recorded significant increases, while the dollar weakened against the zloty and the euro exchange rate strengthened slightly. In the coming week, investors' attention will focus on the MPC's decision on interest rates and retail sales data, as well as the key NFP report from the US labour market and the Bank of England's decision.

Economic indicators

Poland

1. Corporate sector wages (y/y) (October): 6.6%; forecast 7.3%; previous 7.5%

2. Employment growth (y/y) (October): -0.8%; forecast -0.8%; previous -0.8%

3. Industrial production (y/y) (October): 3.2%; forecast 1.8%; previous 7.6%

4. PPI (y/y) (October): -2.2%; forecast -1.8%; previous -1.4%

5. Retail sales (y/y) (October): 3.7%; forecast 5.5%; previous 6.6%

6. Unemployment rate (October): 5.6%; forecast 5.6%; previous 5.6%

7. CPI (y/y) (November) P: 2.4%; previously 2.8%

8. CPI (m/m) (November) P: 0.1%; forecast 0.1%; previously 0.1%

Eurozone

1. Ifo business climate index in Germany (November): 88.1; forecast 88.6; previous 88.4

2. Business expectations in Germany (November): 90.6; forecast 91.4; previous 91.6

3. Current analysis of the situation in Germany (November): 85.6; forecast 85.5; previously 85.3

4. German GDP (q/q) (Q3): 0.0%; forecast 0.0%; previously -0.2%

5. France GDP (q/q) (Q3): 0.5%; forecast 0.5%; previous 0.3%

6. France GDP (y/y) (Q3): 0.9%; forecast 0.9%; previous 0.7%

Germany

1. Ifo Business Climate Index in Germany (November): 88.1; forecast 88.6; previously 88.4

2. Business expectations in Germany (November): 90.6; forecast 91.4; previously 91.6

3. Current analysis of the situation in Germany (November): 85.6; forecast 85.5; previously 85.3

4. German GDP (q/q) (Q3): 0.0%; forecast 0.0%; previously -0.2%

5. German GDP (y/y) (Q3): 0.3%; forecast 0.3%; previous 0.3%

6. German retail sales (m/m) (October): -0.3%; forecast 0.1%; previous 0.3%

France

1. France GDP (q/q) (Q3): 0.5%; forecast 0.5%; previous 0.3%

2. France GDP (y/y) (Q3): 0.9%; forecast 0.9%; previous 0.7%

3. Consumer spending in France (m/m) (October): 0.4%; forecast 0.3%; previously 0.3%

4. CPI in France (m/m) (November) P: -0.1%; forecast 0.0%; previously 0.1%

United Kingdom

1. Car registrations (m/m) (October): -53.7%; forecast 277.4%;

2. Car registrations (y/y) (October): 0.5%; forecast 13.7%;

3. 5-year Treasury bond auction: 4.088%; previously 4.004%

USA

1. Initial jobless claims: 216K; forecast 226K; previously 222K

2. Chicago PMI index (November): 36.3; forecast 44.3; previously 43.8

3. Crude oil inventories: 2.774M; forecast -1.300M; previously -3.426M

4. Jobless claims: 1,960K; forecast 1,953K;

5. Core durable goods orders (m/m) (September): 0.6%; previous 0.5%

6. Durable goods orders (m/m) (September) P: 0.5%; forecast 0.5%; previous 3.0%

7. S&P/CS Composite Home Price Index, n.s.a. (y/y) (September): 1.4%; forecast 1.4%; previously 1.6%

8. Conference Board Consumer Confidence Index (November): 88.7; forecast 93.5; previous 95.5

9. Pending Home Sales Index (m/m) (October): 1.9%; forecast 0.5%; previous 0.1%

10. Dallas Fed Manufacturing Activity Index (November): -10.4; previously -5.0

China

1. China Composite PMI (November): 49.7; previously 50.0

2. Manufacturing PMI (November): 49.2; forecast 49.2; previous 49.0

3. Services PMI (November): 49.5; forecast 50.0; previous 50.1

Currency market

This week, the euro (EUR) strengthened against the Polish zloty (PLN) by 0.09%. The euro price fluctuated between 4.2207 and 4.2393.

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The dollar (USD), on the other hand, weakened against the zloty (PLN) by 0.66%. The price of the dollar fluctuated between 3.6411 and 3.6843.

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Stock exchange

The WIG index rose by 2.68%. The price of the WIG index fluctuated between 108,029 and 111,995.

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Cryptocurrencies

The price of Bitcoin (BTC) rose by 6.06%. The price of Bitcoin fluctuated between PLN 313,169 and PLN 342,530.

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Important events of the past week

Ukraine accepts peace plan: A Ukrainian government delegation announced its acceptance of the Trump administration's peace proposal, which is intended to end the nearly four-year conflict. Secretary Rustem Umerov confirmed that a consensus had been reached on the main terms of the agreement, but noted that the details would need to be clarified during talks in Abu Dhabi and Geneva. Despite the importance of these reports, the situation on the currency markets remained calm, and the EUR/USD exchange rate stabilised just below 1.16 due to limited liquidity on Thanksgiving Day.

CIT for banks in Poland: The President's Office announced that Karol Nawrocki had signed a bill increasing CIT for the banking sector, which is closely correlated with the implementation of the state budget for 2026. The new regulations, previously adopted by the Senate without amendments, will directly affect the cost structure and profitability of financial institutions in Poland. Investors reacted immediately: the WIG20 index, in which banks have a large share, recorded a one-day decline of 0.36%.

Macroeconomic data from Poland: The Central Statistical Office (GUS) published a preliminary estimate of CPI inflation for November at 2.4% y/y, which is below forecasts and the NBP target, with a simultaneous marked increase in industrial production and retail sales. This surprising combination of strong economic recovery and rapid disinflation has fuelled speculation about a fifth consecutive interest rate cut by the Monetary Policy Council. As a result, domestic government bond yields fell, particularly at the short end of the curve, where a 5 basis point decline was recorded on a daily basis.

Pressure for interest rate cuts in the US: A series of weaker US data, including disappointing retail sales and deteriorating consumer sentiment, has increased pressure on the Federal Reserve (Fed). The futures market currently prices in an 85% probability of a rate cut in December, and the projected scale of monetary policy easing by the end of 2026 has approached 90 basis points. The change in sentiment translated into a significant strengthening of the zloty against the dollar, bringing the USD/PLN exchange rate down by 0.66% on a weekly basis.

Events worth watching this week

Outlook for the zloty: The key event for the zloty (PLN) will be Wednesday's meeting of the Monetary Policy Council (RPP) and its decision on interest rates (3 December). Sentiment towards the domestic currency will also be shaped by hard macroeconomic data: the week will start with Monday's producer price inflation (PPI) reading, while on Thursday, 4 December, the market will see data on retail sales and the unemployment rate.

Outlook for the euro: The euro (EUR) will depend on a series of economic indicators, starting with Monday's PMI index for industry (1 December). On Tuesday, investors will focus on price pressures, which will be illustrated by the CPI inflation reading for the Eurozone. The picture of the region's economic condition will be completed by Wednesday's data (3 December) on Gross Domestic Product (GDP).

Outlook for the dollar: On Tuesday (2 December), we will see the ISM manufacturing index reading, and on Wednesday, the ADP report on private sector employment. However, the greatest volatility in the dollar (USD) is expected on Friday, 5 December, with the publication of the most important labour market report – the Non-Farm Payrolls (NFP), i.e. data on changes in non-agricultural employment.

Outlook for the pound: The week for the pound sterling (GBP) will culminate in a key decision by the Bank of England (BoE) on interest rates, which will be announced on Friday, 5 December. Earlier, sectoral indicators will paint a picture of the British economy: on Monday (1 December), the PMI index for industry will be published, and on Wednesday (3 December), we will learn about sentiment in the services sector (PMI for services).

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