?ukasz Bugaj, an analyst at the BO? brokerage, says the zloty has been recently harmed not only by eurozone problems but also by the decisions of top rating agencies to downgrade Hungary's credit rating to junk status. As a result, in early January, the zloty slid steadily against the euro, breaking the zl.4.50 barrier on several occasions.
It was only after Poland received a positive grade from the European Commission that the zloty stopped depreciating. The European Commission—in letter from Olli Rehn, the EU commissioner for economic and monetary affairs—said Poland had taken the right steps to reduce the government deficit this year. Although Poland's budget deficit will overshoot the maximum allowable level of 3 percent of GDP this year, reaching 3.3 percent, it would not cross this mark if the costs of the pension reform were deducted.
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