The Polish currency has strengthened following a decision by Moody's rating agency to keep Poland’s rating unchanged at A2, while deciding to reduce its outlook from stable to negative.
Marek Rogalski, an analyst at BOŚ brokerage, told Poland’s PAP news agency: "The market feared a reduction in the rating and Moody's downgraded only the outlook”.
"There is a rule that if the financial market is afraid of something, and it doesn’t happen, then there’s a reaction. And that’s what happening now.”
Moody's said that the key drivers for its decision, announced in the early hours of Saturday CET, were fiscal risks “related to a substantial increase in current expenditures”, and “impairments to the investment climate from a shift towards more unpredictable policies and legislations”.
In January, Moody’s, one of the world’s big-three rating agencies, had warned that it could downgrade Poland’s rating, following a similar move by Standard & Poor’s earlier that month.
Meanwhile in April, Moody’s warned that Poland’s constitutional crisis could damage the country’s attractiveness to foreign investors. Finance Minister Paweł Szałamacha had said he expected the Polish currency to strengthen on Monday.