ING's latest EMEA FX review, published 8 September 2026, finds that high-yield currencies and Central and Eastern European (CEE) units remain in demand. The review covers eleven currency pairs across the region, from EU-member CEE markets to frontier Central Asian and Middle Eastern units, and collectively points to a common theme: where real interest rates are high and disinflation is on track — Hungary, Kazakhstan, Uzbekistan, South Africa — currencies are finding support, while external risk shocks such as the re-escalated US-Iran conflict and concerns about Russian hybrid warfare in Europe are the main source of pressure.

EUR/PLN: Zloty hit by risk-off mood

The zloty weakened as the US-Iran conflict re-escalated and concerns about Russian hybrid warfare in Europe fuelled a risk-off mood. EUR/PLN recently rose towards 4.35, but ING expects the move to be short-lived. Although ING does not share the market's expectations of interest rate hikes in Poland in the coming months, those bets shield the zloty from the negative impact of external factors. ING's mid-term view on the zloty remains unchanged: it expects a limited rise in EUR/USD in 2H26, while sustainable GDP outperformance versus regional peers and expected inflows of EU funds — the disbursements Poland stands to receive under the current EU budget framework — justify slightly lower levels of the EUR/PLN exchange rate.

EUR/HUF: The gloomy days won't last too long for the forint

With the forint having outperformed peers and experienced a one-sided market since April, a correction was inevitable, but ING believes the outlook remains positive. The Monetary Council is, in ING's view, rightfully non-committal in the current environment: the inflation outlook is much better than the central bank anticipated in June, yet unfavourable developments in risk premiums and energy prices counterbalance this. As a result, markets are pricing in only a small chance of further rate cuts. ING believes a brief pause in the easing cycle and some calmness in global markets could see EUR/HUF move back to 360 or even lower, especially if the inflation target review and the medium-term budget plan, both due in autumn, prove credible.

EUR/CZK: Koruna's main advantage will lose its lustre

A positive interest rate differential in both nominal and real terms has given the koruna a significant advantage over the euro in recent years. This advantage has intensified since late 2024 in real terms, reaching 2.6 percentage points in August. The Czech real interest rate has averaged 1.8% so far this year, while the eurozone real interest rate has remained negative since March. However, the expected pickup in Czech headline inflation is set to push the real yield close to zero early next year, reducing the koruna's leading advantage — a reminder that the currency's carry appeal is a cyclical rather than structural feature. Combined with somewhat disappointing economic performance over 1H26, ING concludes that the koruna is no longer poised for the substantial appreciation it saw in 2025. The currency is expected to hold its current value, with a gradual strengthening trend contingent on a stronger economic rebound.

EUR/RON: Pressures could amplify in the near term

EUR/RON moves have amplified slightly over the past month but have remained contained within the 5.23–5.26 range. With the upcoming S&P rating decision due on 2 October, rating worries have been mounting. Positively, the budget deficit stood at 2.34% of GDP as of July 2026 (versus 3.99% in July last year), a key factor supporting Romania's credit story. The main development to watch remains the push for a fully empowered government committed to fiscal consolidation. After narrowly escaping a downgrade in the summer, ING's base case is that Romania will maintain its rating, provided a solid governance deal is sealed soon. ING expects the pair to remain within its current range and close the year near 5.25.

EUR/RSD: No major changes expected in the coming months

EUR/RSD has continued to trade mostly sideways in the 117.3–117.4 range. The US Treasury's OFAC has extended the operating waiver for Serbia's NIS refinery — which operates under Western sanctions related to its Russian ownership — until 30 September, as the deal with MOL is in its final stages. Recent fiscal expansionary measures led to a revision of the 2026 deficit from 3.0% to 3.5% of GDP, mainly reflecting higher social expenditure; nevertheless, from a macro imbalances standpoint, Serbia's position remains robust at this stage. At its August meeting, the National Bank of Serbia kept the key rate at 5.75%, noting that uncertainty remains elevated despite a better inflation outlook. Between January and July, the bank sold €320m to keep the pair stable, and ING expects FX stability to remain in place.

USD/UAH: Hryvnia strengthens despite headwinds

Even as the US dollar strengthened globally amid a more hawkish Fed, a renewed escalation in the Middle East and the ongoing war in Ukraine, the hryvnia managed to appreciate slightly. It was supported by near-record FX interventions by Ukraine's central bank during the summer and by July's 50bp rate hike to 15.5%, which strengthened the currency's resilience in an increasingly adverse external environment. According to National Bank of Ukraine minutes, most rate-setters believe rates will need to be raised further this year. However, the outlook for the hryvnia remains cloudy as the macroeconomic environment remains challenging.

USD/KZT: High real rates favour continued carry-trade

Contrary to ING's cautious expectations, the tenge appreciated against the US dollar by 3% in August and 5% during the summer months, despite oil flow disruptions and a decline in state support to the domestic FX market. In August, combined net FX sales by quasi-sovereigns, the oil fund and the central bank dropped to $0.3bn versus $1.7bn in May, while net foreign inflows into state bonds stopped after $0.3–0.5bn inflows in June and July. The growing role of private capital flows has increased the tenge's reliance on carry trades — a shift that ties the currency more closely to global investor risk appetite — currently supported by high real rates which are likely to remain. In the longer run, appreciation should be limited by structural factors.

USD/UZS: Supported by portfolio flows and restart of gold exports

The soum appreciated 1% against the US dollar in August after a relatively flat first two months of the summer, likely supported by the restart of gold exports, which totalled $1.3bn in July. Gold is Uzbekistan's dominant export earner, and between January and July the country exported only 18mt of gold versus 85mt for full-year 2025, suggesting scope for a pickup in the rest of the year and keeping ING constructive on the current account and the soum's prospects. Portfolio inflows are also likely to continue: despite a recent indication from the central bank that the nominal policy rate of 14.00% may be lowered by year-end, real rates are likely to remain attractive given the 6.4% CPI.

USD/TRY: Recovery in flows, moderation in growth

Foreign investor positioning has recovered from the US-Iran conflict shock, with long lira positions in FX swaps exceeding pre-war levels, although bond inflows have remained modest. TL deposit inflows continued, while the sector's dollarisation ratio fell from 39.9% in May to 38.5% by late August. Gross reserves reached US$188.2bn. High borrowing costs and tighter macroprudential measures are contributing to a deeper slowdown in 2Q GDP growth. ING expects the economy to maintain moderate growth in 2H26, although risks surrounding its 3.0% full-year GDP growth forecast have increased. Recently the central bank took a step to normalise liquidity by resuming repo auctions; effective funding costs fell from 40% to the policy rate at 37%. The CBT is likely to remain on hold in September but cut by 200bp to 35% in the last quarter.

USD/ZAR: Holding its own

The rand is enjoying a strong quarter and is the third-best performer in the EMFX space. It tends to benefit from the dollar debasement trade, where a pick-up in gold and precious metals is typically ZAR-supportive — South Africa being a major precious metals producer. It also performs well in the low-volatility carry trade environment, where 6.5% implied yields remain attractive; investors think the South African Reserve Bank will need to hike again over the coming quarters. Notably, South Africa's sovereign CDS continues to decline, implying a rating closer to BBB than its current BB. Domestic reforms in energy, logistics and fiscal policy are being welcomed. ING sees stronger rand gains probably coming in 2Q27, when US rates drop.

USD/ILS: Low inflation allows rate cuts, weaker shekel

Low inflation allowed the Bank of Israel to cut rates again in early September, with the policy rate now at 3.25%, compared with 4.00% at the start of the year. If money markets are to be believed, investors expect further aggressive rate cuts over the coming months, potentially taking the policy rate closer to 2.00%; three-month implied yields stand at 2.40%. FX buying intervention earlier in the year, rate cuts and what should now be at least one Fed hike should serve to keep USD/ILS above 3.00 — which is the BoI's preference. ING also views the shekel as one of the currencies most closely correlated to the tech boom, so any correction there can weigh on it.

Source: ING