Last week saw a 7% increase of the Ukraine-bound index, WIG-UKRAIN, at the Warsaw Stock Exchange, with three of the Ukrainian companies recording some 20% upsurge.
Also, Ukraine’s third largest coal producer, Coal Energy, has expanded by a staggering 79%, however, the company is labelled as the most susceptible to speculation, according to a Polish business daily, Puls Biznesu.
The rebound on the stock market is believed to have sprung from the fact that the Ukrainian army has been forcing Russians out of the Kharkiv area.
‘It’s possible that we’ll see a short-term boom. The market has for long been waiting for a growth stimulus and the main reason behind the ongoing slump is the war in Ukraine,’ a broker house analyst, Maciej Kietliński, has explained.
Though the potential end of the Russian invasion would help dial down inflation pressure and mitigate supply shocks, some state policies should be implemented concurrently.
“The war coming to an end won’t suffice, we’re going to need a sea change in Poland’s monetary policy,” Kietliński added.
To weather the downturn in the long run, Poland’s central bank would have to lower key interest rates.
Amid rampant inflation in Poland, the state-run body cannot take such a course of action, as it has raised key interest rates for the 11th time in a bid to tame growing prices.
(pjm)
Source: Puls Biznesu