Foreign exchange market

In 2013, the main factors which determined changes on the foreign exchange market were as follows:

  • quantitative expansion of the U.S. central bank (the Fed) and the signals sent by the Fed regarding the prospects of its departure from this policy;
  • the ECB decreasing the basic interest rate from 0.75% to 0.25%,
  • the drop in the basic interest rate in Poland from 4.25% to 2.50%.

The market was characterised by a high volatility, which was particularly noticeable after 19 June 2013, when the Fed Chairman suggested departing from the so-called policy of quantitative easing. However, the nervous response of the financial markets to this announcement along with the growing uncertainty as to the prospects of the budget consensus in the U.S. Congress encouraged the Fed to soften its position regarding the schedule for withdrawing from the quantitative expansion. This helped to ease the situation on the financial markets significantly, thanks to which the December decision to reduce the scale of the quantitative expansion by USD 10 billion a month from January 2014 did not cause any major perturbations in the financial markets. Ultimately, the year 2013 brought an appreciation of the euro against the dollar (from 1.32 as at the end of 2012 to 1.37 as at the end of 2013) and a slight depreciation in the Polish zloty against the euro (from 4.08 as at the end of 2012 to 4.15 as at the end of 2013) and the Swiss franc (from 3.38 as at the end of 2012 to 3.39 as at the end of 2013).