Euro versus Złoty 2025/2026: Analysis and Forecast for Forex Traders

The EUR-PLN currency pair is one of the most interesting pairs for traders in the European region. The Polish currency offers particular prospects, as Poland has been a member of the European Union since 2004 but has not yet adopted the euro. With the current rate of approximately 4.27 PLN per EUR (As of October 2025), a stable but not uninteresting trading picture emerges.

How is the euro currently positioned against the zloty?

The historical average rate of EUR-PLN since 1998 has been just over 4 PLN per euro, illustrating that the current valuation is within the normal range. However, the last three years reveal an intriguing pattern: after the massive euro appreciation immediately following the outbreak of war in Ukraine, the EUR-PLN has now been falling steadily. This raises the question of why the Polish currency is suddenly showing so much strength.

A look at technical chart analysis reveals an interesting signal. Since March 2025, a possible trend reversal has been indicated, after the rate has bounced multiple times from a significant low. This movement could open up various scenarios for traders.

What factors influence the EUR-PLN exchange rate?

The strength of a currency always depends on the economic power of the country behind it. Several key factors play a role in the EUR-PLN pair:

Interest rate differentials as profit opportunities

A decisive difference is evident in the key interest rates. Poland currently holds an interest rate of 4.75% and signals only gradual cuts for 2026, provided inflation continues to fall. The Eurozone, on the other hand, is at only 2.0%. This interest rate differential of about 2.75% makes the currency pair particularly attractive for carry trade strategies, where traders collect the higher Polish interest rates while investing in euro positions.

Diverging inflation dynamics

Polish inflation was 3.7% in 2024, compared to only 2.4% in the Eurozone. Forecasts for 2025 and 2026 show convergence: Poland is expected to have 3.6% (2025) and 2.8% (2026), while the Eurozone is expected to have 2.1% (2025) and 1.7% (2026). This spread could favor the euro, as lower inflation rates typically signal currency strength.

Robust labor market in Poland

An often overlooked factor is the employment situation. Poland’s unemployment rate is at 3.1%, well below the Eurozone average of 6.2%. This argument favors the zloty, as a functioning labor market indicates economic stability.

Significant economic growth differences

The EBRD forecasts GDP growth of 3.5% for Poland in 2025 and 2026. In contrast, the Eurozone is only expected to grow by 1.2% (2025) and 1.0% (2026). This clear plus for Poland supports the strength of the zloty, especially considering weak consumer confidence and geopolitical uncertainties in Europe.

Debt levels and budget giants

Poland’s national debt has grown to over 416 billion euros by Q2 2025 — an increase of 3.3% compared to the previous quarter. This indicates a continued upward trend in debt. Although the debt ratio remains within healthy limits, further burdens from defense spending and refugee support are likely.

Geopolitical burdens on both sides

The Ukraine war is burdensome for Europe overall but hits Poland harder as a direct neighbor. Millions of Ukrainian refugees strain the budget, but a notable employment participation rate of nearly 70% among this group is observed. Across Europe, confidence is shaken by uncertainty, while Poland remains economically resilient despite risks.

Forecasts for EUR-PLN in the coming years

The analytical community is divided on the future direction. Some experts expect a decline toward 4.20 EUR/PLN, others anticipate values up to 4.44 EUR/PLN by the end of 2026. Erste Group projects 4.30 EUR/PLN in 2026.

This divergence of forecasts reflects the complexity of the situation. The factors analyzed above present a mixed picture:

Arguments for zloty strength (Euro depreciation):

• Significantly higher Polish key interest rates
• Stronger GDP growth
• Lower unemployment rate
• More stable government support under Prime Minister Donald Tusk

Arguments for euro strength (Zloty depreciation):

• Lower inflation in the Eurozone
• Slower debt accumulation in the EU
• More stable long-term institutional structures

Sideways scenario: The opposing forces could balance out, especially since both currencies face similar geopolitical risks. This is indeed the most likely scenario.

Trading opportunities in EUR-PLN

Active traders can consider various approaches:

Range trading in sideways movement: Daily ranges are not particularly large, enabling a relatively stress-free scalping strategy. Enter long positions at lows and exit at the next high.

Carry trade approach: The interest rate differential of 2.75% makes a longer-term position in EUR/PLN interesting for carry traders. They collect the interest differential regularly while betting on sideways movement or slight appreciation.

Technical trend reversal scenarios: The recovery since March 2025 could signal a long-term trend reversal. Aggressive traders might bet on a breakout above previous resistance levels.

Conclusion: What is the strategic outlook for euro vs. zloty?

An objective analysis shows a more balanced picture than some pessimistic assessments suggest. The zloty has appreciated in recent months for good reasons — higher interest rates, robust GDP growth, and a stable labor market are real foundations of this strength.

At the same time, inflation risks and debt dynamics should not be ignored. The best strategy for 2025 and 2026 is to stay flexible and selectively go long at lows rather than waiting for spectacular moves. The EUR-PLN pair may not promise large profits in a short time but offers interesting and regular opportunities for patient traders with proper risk management.