What may be the impact of FTSE Russell’s decision to upgrade Poland’s status to developed market?

In September 2017, FTSE Russell announced the upgrade of Poland from emerging to developed market status, which comes into effect on 24 September. Saxo Bank experts comment on how this may impact the local economy, the FX and bond markets.

Saxo Bank’s Head of Macro Analysis, Christopher Dembik, thinks Poland’s upgrade to a developed market is clearly a big step and represents a strong acknowledgment of the progress of the Polish economy and capital markets. “It may bring more attention to the Polish stock market, but it is not certain that it will lead to a major increase of inflow into the country’s stock markets. Poland will only constitute 0.38% of the FTSE Developed All Cap ex-US, which is lower than its 1.6% composition of the FTSE Emerging All Cap Index”, he said.

“It is highly possible that foreign investors will try to find opportunities in the Polish stock market, but I strongly believe it is often better to be a big fish in a small pond than a small fish in a big pond. Poland’s stock market will be in more direct competition with other well-known developed markets, so it might be trickier in the long run. The financial community and politics will need to do their best to attract on the long-term foreign investors”, Dembik continued. Continue reading “What may be the impact of FTSE Russell’s decision to upgrade Poland’s status to developed market?”