A way for inflation? Poles invest in cryptocurrencies

As many as 66% of Polish investors believe that increasing inflation is a big threat. And what are they going to do about it? Contrary to appearances, they do not limit their investments, but they significantly change their scope - they start buying cryptocurrencies. However, there is also a fairly large group who claim that the economy is bad, but that they will easily keep their income and lifestyle the same… without changing anything in their investments.

Probably no one should be surprised that Polish investors are not in the best mood. Rising inflation is not a positive factor.  The results of the survey conducted on investors from our country confirm this. It shows that as many as 66% of respondents believe that inflation is the greatest risk. Six months ago, similar studies were carried out - then such concerns were expressed by 55% of respondents. 

Investors fear war less than inflation

Interestingly, rising prices scare investors much more than… possible armed conflicts. Although it must be remembered that the study was conducted when conflict on the Russian-Ukrainian border it was just starting to escalate. 

And so these fears are growing very dynamically. In September, international conflicts worried 19% of Polish investors, while now it is a serious problem for 32% of them. As many as 40% are concerned about the overall condition of the Polish economy, and 31% are worried about an increase in taxes.

Confident for a job, unsure about the development of Poland

However, considerable inaccuracies can be found in the respondents' answers. The prospects for the development of the economy in Poland are seen by 31% of people (40% had a positive view of it in September), but as many as 86% of respondents are sure that they will keep their current job, 77% say that they have invested well, and 71% are convinced that they will still will have the same income and will be able to afford the current standard of living. This may be due to the fact that as many as 51% of investors from the country on the Vistula are rebuilding their investment portfolios. 

They were forced to do so by inflation, which in December reached a record level of 8,6%, and in the following months it may be at least at a comparable level. No wonder they have increased too interest ratesalthough the Monetary Policy Council decided to do so only in October 2021, much later than central banks in other Central European countries.

However, this did not cause any sharp price movements even on Stock Exchange in Warsaw. The increase in interest rates made Polish stocks more expensive by an average of 5% in two weeks. 

The increase in interest rates was expected and did not surprise with the amount. Concerns about international conflicts, on the other hand, resulted from the tense situation on the Polish-Belarusian border, and not from Moscow's military escalation directed at Ukraine. 

Escaping Inflation? In cryptocurrencies

How did investors react? It turned out that many of them wanted to be crypto genius. It is the cryptocurrencies - often even deflationary in their assumption - that can be a safe haven in which you can wait out the biggest fluctuations in the prices of fiat currencies. 

Although the knowledge about it - and about raising interest rates - was fairly common, not everyone decided to react. 30% of respondents admit that for a period of three months they did nothing knowing that interest rates would be raised. However, another 25% have opted for tightening their belts - to save more in time when money starts to depreciate. 

Yet another strategy was chosen by 18% of respondents. It is they who invested in cryptocurrencies, often doing it for the first time in their lives. So it is not difficult to guess that the first choice was the biggest and most famous: Bitcoin (BTC) and Ethereum (ETH).