July 3, 2019 / 9:09 AM / 5 months ago

CEE MARKETS-Currencies little changed, bond yields slip as more of dovish ECB seen

    PRAGUE, July 3 (Reuters) - Central European currencies
traded little changed on Wednesday as markets digested the
nomination for the new European Central Bank chief, prospects of
an economic slowdown and further trade disputes which weighed on
Asian markets overnight.
    European Union leaders agreed that International Monetary
Fund chief Christine Lagarde should replace Mario Draghi at the
helm of the ECB. Analysts expect Lagarde to continue with
Draghi's dovish policy stance after his term expires at the end
of October.     
    Global bond yields were hitting new lows as investors bet on
further monetary easing around the world amid faltering global
growth.
    The Polish zloty was a touch firmer ahead of
National Bank of Poland's rate decision, due in early afternoon.
Market will likely focus on the bank's fresh inflation outlook
as it is expected to keep interest rates unchanged.
    "Despite the acceleration of inflation, (possibly) higher
GDP and CPI forecasts in the July NBP projection and the easing
of the rhetoric of the world's largest central banks, the
meeting of the Monetary Policy Council ending today should not
stir up much emotion," Bank Millenium said in a note.
    Hungary's forint and Czech crown traded
a shade weaker on the day.
    Asian shares fell on Wednesday as initial enthusiasm over
the latest U.S.-China trade truce was overtaken by fresh
concerns over Washington's threat of tariffs on additional
European goods.
    Global growth concerns also weighed on investor confidence,
with South Korea the latest trade-reliant economy to cut its
economic growth and export targets, a day after weaker factory
readings worldwide. 
    
                         CEE         SNAPSHOT    AT                        
                         MARKETS                1039              
                                                CET               
                                     CURRENCIE                             
                                     S                            
                                     Latest     Previou  Daily    Change
                                                s                 
                                     bid        close    change   in 2019
 EURCZK=      Czech                    25.4500  25.4535   +0.01%     +1.01%
              crown                                               
 EURHUF=      Hungary                 323.0200  323.095   +0.02%     -0.60%
              forint                                  0           
 EURPLN=      Polish                    4.2436   4.2433   -0.01%     +1.08%
              zloty                                               
 EURRON=      Romanian                  4.7360   4.7330   -0.06%     -1.73%
              leu                                                 
 EURHRK=      Croatian                  7.3955   7.3945   -0.01%     +0.20%
              kuna                                                
 EURRSD=      Serbian                 117.7000  117.760   +0.05%     +0.51%
              dinar                                   0           
              Note:      calculated from                 1800              
              daily                                      CET      
              change                                              
                                                                           
                                     Latest     Previou  Daily    Change
                                                s                 
                                                close    change   in 2019
 .PX          Prague                   1043.42  1040.72   +0.26%     +5.76%
                                                     00           
 .BUX         Budapest                40928.38  40767.1   +0.40%     +4.57%
                                                      2           
 .WIG20       Warsaw                   2337.77  2341.09   -0.14%     +2.69%
 .BETI        Bucharest                8852.21  8773.99   +0.89%    +19.89%
 .SBITOP      Ljubljana                 879.14   877.77   +0.16%     +9.31%
 .CRBEX       Zagreb                   1876.03  1886.96   -0.58%     +7.27%
 .BELEX15     Belgrade                  739.31   740.81   -0.20%     -2.94%
 .SOFIX       Sofia                     582.51   581.74   +0.13%     -2.01%
                                     BONDS                                 
                                     Yield      Yield    Spread   Daily
                                     (bid)      change   vs Bund  change in
              Czech                                               spread
              Republic                                            
 CZ2YT=RR       2-year                  1.6020   0.1480   +237bp     +17bps
                                                               s  
 CZ5YT=RR       5-year                  1.3600   0.0900   +207bp     +11bps
                                                               s  
 CZ10YT=RR      10-year  <CZ10YT=RR     1.5070  -0.0070   +190bp      +2bps
                         >                                     s  
              Poland                                                       
 PL2YT=RR       2-year                  1.5850  -0.0100   +235bp      +1bps
                                                               s  
 PL5YT=RR       5-year                  1.8930  -0.0410   +260bp      -2bps
                                                               s  
 PL10YT=RR      10-year  <PL10YT=RR     2.3240  -0.0340   +272bp      +0bps
                         >                                     s  
                         FORWARD     RATE       AGREEME                    
                                                NT                
                                     3x6        6x9      9x12     3M
                                                                  interbank
              Czech Rep          <P       2.17     2.09     1.98       2.17
                         RIBOR=>                                  
              Hungary            <B       0.29     0.38     0.47       0.25
                         UBOR=>                                   
              Poland             <W       1.74     1.73     1.72       1.72
                         IBOR=>                                   
              Note: FRA  are for ask prices                                
              quotes                                              
       

 (Reporting by Robert Muller and Alicja Ptak, Editing by William
Maclean)
  
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