Not so fast with discounts. What will the week bring?

Last week's data on the labor market and retail sales in the United States turned out to be better than expected. Given the exceptionally resilient US economy and forecasts of no risk of recession, the probability of the Fed cutting interest rates in March has dropped to approximately 50%. What will the Fed do in March?

Common currency under pressure

More and more signals point to a strong labor market in the US, which may be a signal to negate the first Fed interest rate cut in March. On the other hand, regional indices perform significantly worse, which may indicate that the situation has deteriorated since the beginning of the year. Until recently, the probability of monetary policy easing at the Fed's March meeting reached 80% - currently, such a scenario is estimated at approximately 50%. Further expectations regarding future Fed actions will be crucial for the USD valuation. The dollar index is almost perfectly correlated with the probability of cutting rates - if they fall by another 10 or 20 percentage points, the dollar may gain another 2-3%.

The strong dollar and the clearly hawkish ECB do not help the valuation EUR / USD. The main currency pair tested around 1,09 last week, and comments from ECB central bankers keep the common currency under pressure. Given the economic weakness of the euro zone and the high chance that the Fed will not reduce interest rates in March, EUR/USD may continue to decline in the following weeks.

Meanwhile, in Poland, core inflation has already dropped to 6,9%, and in February or March its level may reach the inflation target. Given the weaker condition of the European economy, is there room for easing monetary conditions in Poland?

We invite you to meet the economist XTB Michał Stajniak, in which he will focus on the key topics of this week.

In today's webinar:

• What will the Fed do in March?
• What's next for the BTC price?
• Will inflation in Poland increase further?

WATCH ON-LINE

In addition, due to the very dynamic situation in the world, additional ones are available raports Video on the impact of war, pandemic and economic crisis on the global economy.

About the host

Michał Stajniak

Michał Stajniak - Raw Material Market Analyst in XTB. It places particular emphasis on the linkages between the behavior of commodity prices and the currencies of economies heavily dependent on exports of commodities such as oil, iron ore, gold and powdered milk. He is the author of frequent comments comparing commodity price indices with currency pairs such as AUDUSD, NZDUSD, USDCAD, USDNOK, or EURNOK. He represents XTB in the media (including TVN24 BIS, Polsat News, TVP Info, Bankier TV or Onet TV) and is the author of articles in the financial press such as Parkiet, Puls Biznesu and Dziennik Gazeta Prawna. He is a practitioner of the stock market and the derivative market. In his approach, he values ​​fundamental analysis above all, but often uses Fibonacci levels to determine the demand and supply zones needed in a Price Action strategy. A graduate of Quantitative Methods in Economics and Information Systems at the Warsaw School of Economics.

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