Another soft reading (albeit temporary) to push PLN lower Our economists are looking for a below consensus August Polish CPI (ING – 1.0% YoY, consensus -0.9%). The deceleration in food and fuel prices should bring CPI to the lowest level on record. However, the recent rise in market expectations of NBP cuts are not warranted given (a) legal changes should push CPI back to NBP target; (b) the weak July 16 activity data being largely caused by one-off factors. Eventually, this should lead to market pricing out NBP cuts (currently a 20bps cut priced in over 9-month) and take some pressure of PLN. Yet, over the very short-term, risks are still skewed to higher EUR/PLN given the ongoing soft stream of Polish data (such as today’s CPI) and currently challenging post Jackson Hole external environment for EM FX (the key driver behind yesterday’s CEE FX weakness). EUR/PLN to test the 100-day MA 4.3703 resistance.