The US military attack on targets in Iran triggered a sharp sell-off on global financial markets. The Polish stock exchange is experiencing one of its worst sessions in recent months, and the zloty has become one of the world's weakest currencies, losing value against the dollar and euro. Investors are fleeing risk, resulting in a sharp rise in oil prices and government bond yields amid growing geopolitical uncertainty.
Sharp Declines on the WSE
The WIG20 index is experiencing a session of deep declines, reacting to the armed conflict in Iran and a sell-off in Asian markets.
Zloty Drastically Weakens
The Polish currency is losing value against the dollar and euro, becoming one of the weakest units in the emerging markets basket.
MPC Decision in Question
The new geopolitical situation may impact previously anticipated interest rate cuts in Poland.
Rising Commodity Prices
Prices for oil and copper are rising due to fears of supply chain disruptions and destruction of production infrastructure.
The escalation of military conflict in the Middle East led to an immediate collapse of sentiment in capital markets. The Warsaw Stock Exchange is experiencing a massive sell-off of shares, hitting the commodity and energy sectors hardest. The WIG20 index is plummeting, following Asian markets where the Korean Kospi index plunged over 7.2%. Analysts at Saxo Bank indicate that war with Iran is becoming the main factor shaping scenarios for the global economy in 2026, displacing previous inflation concerns. The situation in the currency market reflects a classic flight to safe havens. The Polish zloty is under strong pressure, reaching 4.26 per euro, while the US dollar is surging. The weakening of the domestic currency comes at a critical moment, just before a decisive meeting of the Monetary Policy Council. While markets previously priced in a 25 basis point rate cut, the current external shock and risk of rising energy prices may prompt the Council to revise these plans or adopt greater caution in its monetary easing cycle. US-Iran relations have been hostile since the 1979 hostage crisis, and Iran, controlling the key transport route in the Strait of Hormuz, has repeatedly used the threat of an oil supply blockade as a tool of geopolitical pressure. Simultaneously, strategic commodities, including copper and crude oil, are becoming more expensive, directly impacting corporate operating costs. On the WSE, shares of KGHM and energy companies like PGE are under particular scrutiny as they react to dynamic changes in energy carrier prices. „This will extend periods of shocks in the markets” — Financial Markets Analyst Uncertainty is compounded by data showing accelerating inflation in Turkey, suggesting that regional tensions may have a more lasting impact on global price stability than initially assumed. Investors anxiously await further military developments, which will determine the sustainability of the current crash.