The Swiss francs and Polish zloty pair is an exotic instrument. Traders can count on good profits during the political instability of Poland.
The Swiss franc is considered a very safe currency. Due to this, during various instabilities, investors invest in it, causing it to strengthen significantly. But such an assessment is not always correct and true.
In Poland, at the beginning of 2015, homeowners with mortgages in Swiss francs suffered from a sharp fluctuation in the exchange rate of the Swiss franc/Polish zloty (CHF/PLN), which led to a significant increase in the cost of their mortgages in local currency.
It was assumed that these adverse financial circumstances will affect not only the finances of households but also the psychological well-being and physical health of people. In general, this is exactly what happened, which ultimately led to a decrease in the country's GDP and a deep internal crisis of the economy.
Although Poland is gradually recovering, the zloty is very weak, depending on the euro exchange rate, trade relations within the EU, the cost of energy and many other factors that do not affect global economic mechanisms.
This makes the zloty incredibly volatile, respectively, investors are aware of the risks and do not seek to choose the CHF/PLN pair as their main trading asset.
In the long run, the instrument is characterized by very high risks and instability. In the short term, it can still be used for high-risk scalping.
It will also be interesting for traders to find out that Poland’s gold reserve decreases annually, while Switzerland’s increases, so the zloty has a natural loss of value in proportion to the decrease in gold reserves in the country.
The CHF/PLN pair is generally predictable. Amid the economic downturn in the eurozone and the uncertain political situation in the world, the euro will weaken. Against this background, investors will continue to hedge funds in CHF. As a result, the Swiss franc will continue to rise in price.
Since the EU includes some of the post-Soviet states, as well as Greece, there is no reason to count on a rapid surge in the Euro economy. Consequently, the growth of the franc will be prolonged and unhurried.
Against this background, the zloty will show sharp fluctuations. The Polish currency is tied to the light and chemical industries, as these are the main export goods, accounting for more than 60% of all foreign trade.
The mood in Germany will also influence the currency. It is Poland’s largest trading partner, and if German industry begins to experience difficulties, it will immediately affect the zloty
Another important moment for the correlation is that about 18% of Poles officially work in Germany. This allows them to receive higher salaries than in Poland and positively influence the results of GDP. But its actual level is lower than estimated.
This leads to frequent problems in employment, strikes, and production disruptions. As a result, the country, although striving to maintain a leading position in eastern Europe, has a hard time doing it.
Of course, the zloty exchange rate is also affected by financial news, in particular, the announcement of the national bank exchange rate. When it decreases, the currency weakens. On the other hand, the bank is forced to take such measures to maintain a stable level of inflation.
In general, more than 100 factors can be identified that have a serious impact on the zloty exchange rate. Traders who want and will be able to study them will gain the key to volatile changes in the CHF/PLN pair, and therefore will receive an instrument for super-profitable scalping.
On the other hand, the risk of losing a deposit is very high, so few decide to trade this exotic pair.