There was a little flurry of excitement in European emerging markets this week after the National Bank of Poland raised its benchmark interest rate. Naturally, various opinions were expressed about why the central bank had acted, but the best without doubt comes from Wike Groenenberg, senior strategist for Central Europe, Middle East and Africa at Citi.
“Poland is hosting the European Football Championships in 2012, [and] that will lead to sizeable investments in infrastructure and create further pressures in the construction sector. The central bank is increasingly concerned about the impact of the economic expansion on prices and will therefore continue to hike rates,” she told me.
Know your audience is one of the first rules of journalism. It also seems apt for strategists, and hats off to Wike for saying something that will appeal to most traders.