Tuesday's session on the Warsaw Stock Exchange ended with a massive sell-off, triggered by the escalation of conflict in the Middle East following a US attack on Iran. The index of the largest companies lost most of this year's gains in two days, and the Polish currency weakened sharply against the dollar and euro. Investors are fleeing risky assets en masse, a trend further deepened by hawkish statements from the Prime Minister regarding the energy sector and the growing specter of global stagflation.
Crash of Warsaw indices
The WSE recorded the strongest sell-off in nearly a year, losing in two days almost all the profits generated since the beginning of 2026.
Zloty exchange rate collapse
The Polish currency sharply lost value against the dollar, euro, and franc due to capital flight to safe assets.
Attack on Iran and inflation
The escalation of conflict in the Middle East pushed up energy commodity prices, threatening a new wave of price increases in the eurozone and Poland.
Uncertainty over interest rates
The RPP has begun its meeting; rising war risks may prevent the Council from the previously signaled interest rate cut.
The Polish economy and financial markets are facing the most serious shock in months, caused by the direct US military intervention in Iran. The Warsaw Stock Exchange witnessed a phenomenon analysts call a "Red Tuesday," where the WIG20 index recorded a spectacular drop, wiping out almost all the gains from the bull market at the start of 2026. State-owned energy champions and Orlen felt particular pressure, with the latter's shares plummeting after unfortunate remarks by the head of government. The scale of the sell-off on the Polish stock market was one of the largest in Europe, indicating the region's high sensitivity to geopolitical risks. Foreign capital, which had previously eagerly bought Polish bonds, began to withdraw sharply towards safe havens, although traditional assets like gold behaved unpredictably, losing their status as a stable shelter at the peak of the session. Simultaneously, the foreign exchange market saw a collapse in the zloty's value. The Polish currency became one of the main losers of the global flight from risk, losing significant value against key reserve currencies. The situation is complicated by data on rising inflation in the eurozone, which emerged even before the outbreak of open conflict. Economists warn that rising oil and natural gas prices could permanently boost price dynamics in Poland, casting doubt on expected interest rate cuts. Although the RPP has just begun its March meeting in an atmosphere conducive to monetary easing, new pro-inflationary factors may force the Council to maintain the current restrictive levels of the cost of money. The Middle East accounts for about one-third of global oil production, and any disruptions to transport through the Strait of Hormuz have historically caused immediate supply shocks on global energy markets. In the commodities sector, we are observing extreme volatility. While industrial metals like aluminum are rising in price due to supply chain concerns, copper continues its downward trend, heralding an upcoming economic slowdown. In the cryptocurrency market, Bitcoin also lost momentum, confirming a broad retreat from speculative assets. Experts point to the real risk of stagflation – a scenario where high energy prices stifle growth while central banks are prevented from supporting the economy due to inflation. The coming days will be crucial for stabilizing sentiment, but current signals from Wall Street suggest the phase of panic selling may continue. „What we are seeing on the shares of fuel and energy companies is not a regular correction, but a carnage caused by the loss of investor confidence.” — Market Analyst