Market Summary by AFORTI: US takeover of Venezuela, low inflation in Poland, currency crash and protests in Iran
Last week, key events included the US taking control of Venezuela and arresting President Maduro, Polish inflation falling below the NBP target, and protests breaking out in Iran. On the asset markets, the WIG index and Bitcoin recorded gains, while oil and gold lost value; at the same time, the zloty strengthened against the euro but weakened against the dollar. In the coming week, investors' attention will focus on the publication of US labour market data (NFP), inflation indicators in the Eurozone and Friday's auction of Polish treasury bonds.
Economic indicators
Poland
1. CPI (y/y) (December): 2.4%; forecast 2.5%; previous 2.5%;
2. CPI (m/m) (December): 0.0%; forecast -; previous 0.1%;
3. PMI for industry (December): 48.50; forecast 49.00; previous 49.10;
Eurozone
1. PMI index for industry (December): 48.8; forecast 49.2; previously 49.6;
2. M3 money supply (y/y) (November): 3.0%; forecast 2.7%; previously 2.8%;
3. Private loans (y/y) (November): 2.9%; forecast 2.8%; previous 2.8%;
Germany
1. PMI index for industry in Germany (December): 47.0; forecast 47.7; previous 48.2;
France
1. Total unemployment in France (November): 3,129.3K; forecast -; previous 3,150.8K;
2. PMI index for industry in France (December): 50.7; forecast 50.6; previous 47.8;
United Kingdom
1. Nationwide House Price Index (HPI) (MoM) (December): -0.4%; forecast 0.1%; previous 0.3%;
2. Nationwide House Price Index (HPI) (y/y) (December): 0.6%; forecast 1.2%; previous 1.8%;
3. Manufacturing PMI (December): 50.6; forecast 51.2; previous 51.2;
USA
1. Crude oil inventories: 0.405M; forecast -2.000M; previous -1.274M;
2. Crude oil inventories in Cushing: 0.707M; forecast -; previous -0.742M;
3. Gasoline stocks: 2.862M; forecast 1.100M; previous 4.808M;
4. Initial jobless claims: 199K; forecast 219K; previous 215K;
5. Crude oil inventories: -1.934M; forecast 0.500M; previous 0.405M;
6. Gasoline inventories: 5.845M; forecast 2.000M; previous 2.862M;
7. Pending home sales index (m/m) (November): 3.3%; forecast 1.0%; previous 2.4%;
8. Chicago PMI index (December): 43.5; forecast 39.8; previous 36.3;
9. Weekly distillate prices according to EIA: 4.977M; forecast 2.000M; previously 0.202M;
10. PMI index for industry (December): 51.8; forecast 51.8; previously 52.2;
China
1. Manufacturing PMI (December): 50.1; forecast 49.2; previous 49.2;
2. China Composite PMI (December): 50.7; forecast -; previous 49.7;
3. Services PMI (December): 50.2; forecast 49.6; previous 49.5;
4. Caixin Manufacturing PMI (m/m) (December): 50.1; forecast 49.8; previous 49.9;
Currency market
This week, the euro (EUR) weakened against the Polish zloty (PLN) by 0.14%. The euro price fluctuated between 4.2086 and 4.2331.
The US dollar (USD), on the other hand, strengthened against the Polish zloty (PLN) by 0.30%. The price of the dollar fluctuated between 3.57959 and 3.6035.
Oil and gold market
The price of BRENT crude oil fell by 0.15%. The price fluctuated between 60.06 and 61.88 USD/barrel.
Gold, on the other hand, fell by 4.86%. The price of gold fluctuated between 4,300.60 and 4,578.05 USD/ounce.
Stock exchange
The WIG index rose by 3.47%. The price of the WIG index fluctuated between 115,978 and 120,299.
Cryptocurrencies
The price of Bitcoin (BTC) rose by 2.27% and fluctuated between PLN 313,001 and PLN 342,100.
Important events of the past week
Coup in Venezuela and takeover by the US: On the night of 2 to 3 January, US special forces carried out an operation in Venezuela, resulting in the arrest of President Nicolas Maduro and his wife in their bedroom and their transport to the US, where they will stand trial. Donald Trump announced that the United States would take temporary control of the country and that American companies would rebuild the oil infrastructure to finance the costs of the intervention. Washington's takeover of one of the world's largest oil reserves is a powerful signal to commodity markets. Although this may lead to a decline in oil prices in the long term, in the short term it generates significant geopolitical uncertainty.
Decline in inflation in Poland and strengthening of the zloty: According to preliminary estimates, December CPI inflation in Poland was 2.4% y/y, which is below market forecasts and the NBP's point target. The marked decline in price pressure, supported by cheaper fuels, paves the way for the Monetary Policy Council to start cutting interest rates in the first half of 2026. This data was positively received by the currency market – the zloty ended the year on a strong note, stabilising the EUR/PLN exchange rate at around 4.21.
Mass protests and currency crisis in Iran: Iran has seen its largest protests since 2022, triggered by a sharp collapse in the local currency (the rial) and inflation reaching 40%. The economic demonstrations, directly caused by a drastic increase in food prices, have spread across the country, further destabilising a regime already weakened by earlier conflicts. This situation significantly increases geopolitical risk in the Persian Gulf region, which is being closely monitored by investors and may contribute to increased volatility in energy commodity prices.
Historical record of the Warsaw Stock Exchange in 2025: The WIG broad market index ended 2025 with a historic increase of 47.3%, outperforming the world's major stock exchanges, including the US S&P 500 and the German DAX. The bull market was mainly driven by large companies from the WIG20 index (up by over 45%), such as KGHM and banks, which attracted foreign capital thanks to attractive valuations and a weakening dollar. This spectacular result placed the Warsaw Stock Exchange among the European leaders, confirming the return of global investors' confidence in Polish assets.
Events worth watching this week
Outlook for the zloty: Trading in the zloty will be limited on Tuesday due to the Epiphany holiday, so the market's attention will shift to Friday's auction of treasury bonds worth PLN 7-12 billion. The currency is entering the new year with the support of low inflation (2.4%), which has fallen below the NBP's target, paving the way for interest rate cuts in the first half of 2026. Positive sentiment around Polish assets is also sustained by a record bull market on the Warsaw Stock Exchange, where the WIG index gained over 47% last year.
Outlook for the euro: Volatility for the euro will be provided by Tuesday's release of the preliminary CPI inflation index (forecast 2.3%) and PMI readings for the services sector in Germany and France. Investors will closely analyse the condition of the German economy through Wednesday's retail sales and unemployment data and Friday's industrial production reports. These data are key to future ECB decisions, especially in light of the forecast core inflation remaining at 2.4%.
Outlook for the dollar: The dollar will be under pressure from geopolitical uncertainty caused by the US attack on Venezuela and the arrest of President Maduro, which is affecting commodity markets. The macroeconomic calendar is dominated by Friday's NFP report (forecast: 57,000 jobs, unemployment rate 4.5%), which will be preceded by Wednesday's ADP and JOLTS data. The picture of the economy will be completed by ISM indices for industry and services, verifying investor sentiment after strong GDP growth in the third quarter.
Outlook for the pound: The pound will react to Monday's mortgage and consumer credit data and Tuesday's BRC retail sales report. In the second half of the week, investors' attention will shift to the property market, mainly due to Wednesday's PMI index for construction and Thursday's Halifax house price index. These publications will allow us to assess the condition of the British economy after a successful year in which the FTSE 100 index gained over 21%.
TREASURY DEPARTMENT
AFORTI.BIZ
Currency Market Overview 2025
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