Market Summary by AFORTI: New tariff news from the USA, presidential election, interest rates.

The past week in the financial markets and the economy was full of a number of important developments. The week began and ended with the topic of tariffs and the zloty remained influenced by investor uncertainty due to the presidential election. Many important macroeconomic data from Poland and the world were also published.

Economic indicators

Poland

1. GDP k/k (Q1): value: 0.4%; forecast: 0.4%; previously: -0,1%

2. GDP y/y (Q1): value: 2.0%; forecast: 2.0%; previously: 1,0%

3. unemployment rate (Apr): value: 5.1%; forecast: 5.1%; previous: 5,3%

4. y/y CPI (May): value: 2.5%; forecast: 2.5%; previously: 2,4%

5. m/m CPI (May): value: 0.1%; forecast: 0.3%; previous: 1,1%

6. manufacturing PMI (May): value: 45.0; forecast: 45.9; previous: 45,9

7. industrial production y/y (Apr): value: -1.6%; forecast: -1.3%; previous: 6,0%

8. retail sales y/y (Apr): value: 4.1%; forecast: 5.3%; previous: 6,1%

9. PPI output prices y/y (Apr): value: -8.6%; forecast: -8.5%; previous: -10,0%

Eurozone

1. CPI y/y (May): value: 2.6%; forecast: 2.5%; previous: 2,4%

2. core CPI y/y (May): value: 2.9%; forecast: 2.7%; previous: 2,7%

3. unemployment rate (Apr): value: 6.4%; forecast: 6.5%; prev: 6,5%

4. y/y GDP (q1): value: 0.4%; forecast: 0.4%; previously: 0,1%

5. q/q GDP (Q1): value: 0.3%; forecast: 0.3%; previously: -0,1%

6. manufacturing PMI (May): value: 47.3; forecast: 47.4; previous: 45,7

Germany

1. CPI y/y (May): value: 2.4%; forecast: 2.4%; previous: 2,2%

2nd CPI m/m (May): value: 0.1%; forecast: 0.2%; previous: 0,5%

3. manufacturing PMI (May): value: 45.4; forecast: 43.4; previous: 42,5

4. retail sales y/y (Apr): value: 0.6%; forecast: 0.1%; previous: -2,7%

5. GDP y/y (Q1): value: 0.2%; forecast: 0.2%; previously: -0,2%

6. q/q GDP (Q1): value: 0.2%; forecast: 0.2%; previously: -0,5%

France

1. CPI y/y (May): value: 2.2%; forecast: 2.2%; previously: 2,2%

2. m/m CPI (May): value: 0.1%; forecast: 0.2%; previously: 0,5%

3. y/y GDP (Q1): value: 1.1%; forecast: 1.1%; previously: 0,7%

4. GDP k/k (Q1): value: 0.2%; forecast: 0.2%; previously: 0,2%

5. manufacturing PMI (May): value: 46.4; forecast: 46.7; previous: 45,3

United Kingdom

1. CPI y/y (Apr): value: 2.3%; forecast: 2.1%; previous: 3,2%

2. core CPI y/y (Apr): value: 3.9%; forecast: 3.6%; previous: 4,2%

3. retail sales m/m (Apr): value: -2.3%; forecast: -0.4%; previous: 0,2%

4. manufacturing PMI (May): value: 51.3; forecast: 51.3; previous: 49,1

5. unemployment rate (Mar): value: 4.3%; forecast: 4.3%; previous: 4,2%

USA

1. annual GDP (Q1, rev): value: 1.3%; forecast: 1.3%; prev: 3,4%

2 PCE prices y/y (Apr): value: 2.7%; forecast: 2.7%; prev: 2,7%

3. core PCE y/y (Apr): value: 2.8%; forecast: 2.8%; previous: 2,8%

4. CPI y/y (Apr): value: 3.4%; forecast: 3.4%; prev: 3,5%

5. baseline CPI y/y (Apr): value: 3.6%; forecast: 3.6%; previous: 3,8%

6. unemployment rate (Apr): value: 3.9%; forecast: 3.8%; previous: 3,8%

7. retail sales m/m (Apr): value: 0.0%; forecast: 0.4%; prev: 0,6%

8. industrial production m/m (Apr): value: 0.0%; forecast: 0.1%; previous: 0,1%

9. manufacturing PMI (May): value: 50.9; forecast: 50.9; previous: 50,0

10. personal spending m/m (Apr): value: 0.2%; forecast: 0.3%; previous: 0,7%

China

1. GDP y/y (Q1): value: 5.3%; forecast: 5.0%; previous: 5,2%

2. industrial production y/y (Apr): value: 6.7%; forecast: 5.5%; previous: 4,5%

3. retail sales y/y (Apr): value: 2.3%; forecast: 3.8%; prev: 3,1%

4. unemployment rate (Apr): value: 5.0%; forecast: 5.1%; prev: 5,2%

5. manufacturing PMI (May): value: 49.5; forecast: 50.5; previous: 50,4

6. Caixin manufacturing PMI (May): value: 51.7; forecast: 51.5; previous: 51,4

Foreign exchange market

The euro (EUR) maintained its value this week after large fluctuations. The euro price oscillated between 4.2328 and 4.2525.

Similarly, the dollar (USD) maintained its value after high volatility. The dollar price oscillated between 3.7224 and 3.7782.

Oil and gold market

The price of BRENT crude oil fell by 3.60%, and oscillated in a range of US$62.18 - 65.43/barrel. 

The gold price fell by 1.30% and oscillated in a range of USD 3269.62 - 3383.00/ounce.

Stock market

The valuation of the WIG index increased by 1.55% and oscillated in the range of 99,926 - 104,468.

Cryptocurrencies

The price of Bitcoin (BTC) fell by 3.57%, oscillating in the range of 388,750 - 409,999. 

Important events of the past week

Trump's tariff threats and meeting with von der Leyen: Just before the previous weekend, Donald Trump returned to threatening tariffs, suggesting to impose 50% tariffs on EU goods from 1 June. He also threatened 25% tariffs on Apple products if they were not made in the USA. However, already on Monday, before the opening of European markets, Trump announced that he was putting his latest idea on hold until 9 July, following a conversation with Ursula von der Leyen. The suspension is intended to give both sides time to negotiate.

Events with customs and courts in the USA: Last week, the US Federal Court of International Trade blocked Donald Trump's imposed global reciprocal tariffs and separate tariffs on Mexico and Canada. The court found that by imposing large-scale tariffs, the USA president had abused his power. The court's decision did not extend to tariffs imposed on other grounds, such as steel and aluminium tariffs. The Trump administration reacted immediately by announcing an appeal, and the appeals court suspended the decision to block the tariffs after a day.

Unexpected sales growth: Poland's retail sales recorded a strong rebound in April, exceeding market expectations. Growth in real terms came in at 7.6% y/y, against a consensus forecast of 3.4%. Such strong data surprised the market, especially in the context of two previous weaker readings - the last of which indicated a 0.3% y/y decline in sales. These results may signal a recovery in domestic consumption, although further observation will be needed to confirm the sustainability of this trend.

Presidential election in Poland: The second round of the presidential election in Poland took place on Sunday, 1 June. In the end, with a narrow lead over Rafał Trzaskowski, voters elected Karol Nawrocki as president. Yesterday's vote recorded a record turnout of almost 72 per cent. Once the Supreme Court confirms the validity of the election, the swearing-in of the new President of the Republic of Poland will take place on 6 August.

Events worth watching this week

Polish zloty's reaction to the election result: The valuation of the Polish zloty may fluctuate strongly in the coming days. Although presidential elections have not usually had a significant impact on our currency, analysts were already predicting a different situation before the first round, pointing to the candidates' different approaches to the European Union. The outcome of the election may weaken the zloty, as investors may be more cautious about investing in the Polish economy in anticipation of the swearing-in and the first decisions of the new president.

Interest rate in Poland: The Monetary Policy Council's decision on interest rates is expected to be published on Wednesday. It should be borne in mind that both the previous two decisions and the following conferences of the President of the National Bank of Poland, Adam Glapiński, significantly affected the valuation of the Polish zloty. For example, the April announcement of rate cuts resulted in a weakening of the zloty by around 7 cents against the euro and 10 cents against the dollar. In turn, the May announcement of a slow process of rate cuts strengthened the zloty against all major currencies. Therefore, the upcoming decision and conference are worth watching closely.

TREASURY DEPARTMENT

AFORTI.BIZ