June 29, 2020 / 9:58 AM / 5 days ago

CEE MARKETS-Forint extends losses on hints of fresh rate cut

    By Radu-Sorin Marinas
    BUDAPEST, June 29 (Reuters) - Hungary's forint extended last
week's losses on Monday, underperforming the region, after a
central banker said there was more scope for easing after a
surprise interest rate cut last week. 
    By 0930 GMT, the forint, central Europe's
worst-performing currency so far this year, was down 0.18% to
trade at 355.75 to the euro, close to two-month lows.
    The Polish zloty, the Romanian leu and
the Czech crown were virtually unchanged, in thin
trading.     
    "The FX market is rather worried that the forint will be
wholly exposed to volatility as soon as the next risk off move
hits EM assets," Commerzbank analysts said in a note.
    They added that with another 15 basis point rate cut now
being priced in for July, the forint weakened towards the end of
last week and "is likely to continue to underperform in the
months ahead."
    Deputy Governor Barnabas Virag said on Friday the National
Bank of Hungary may cut its base rate by another 15 basis points
in July, adding that market pricing of further aggressive rate
easing was exaggerated.
    
           CEE         SNAPSHOT     AT  1135                    
           MARKETS                 CET                  
                       CURRENCIES                               
                       Latest      Previous   Daily     Change
                       bid         close      change    in 2020
 Czech                    26.7670    26.8000    +0.12%    -4.99%
 crown                                                  
 Hungary                 355.7500   355.1000    -0.18%    -6.92%
 forint                                                 
 Polish                    4.4605     4.4620    +0.03%    -4.58%
 zloty                                                  
 Romanian                  4.8440     4.8417    -0.05%    -1.15%
 leu                                                    
 Croatian                  7.5720     7.5575    -0.19%    -1.67%
 kuna                                                   
 Serbian                 117.5400   117.5600    +0.02%    +0.03%
 dinar                                                  
 Note:     calculated from                    1800 CET          
 daily                                                  
 change                                                 
                                                                
                       Latest      Previous   Daily     Change
                                   close      change    in 2020
 Prague                    922.21   920.8800    +0.14%   -17.34%
 Budapest                36285.41   36360.44    -0.21%   -21.26%
 Warsaw                   1759.91    1759.43    +0.03%   -18.15%
 Buchares                 8610.96    8603.86    +0.08%   -13.69%
 t                                                      
 Ljubljan                  854.74     857.37    -0.31%    -7.68%
 a                                                      
 Zagreb                   1596.12    1590.84    +0.33%   -20.88%
 Belgrade                  663.51     660.40    +0.47%   -17.24%
 Sofia                     454.08     455.15    -0.24%   -20.08%
                                                                
                       Yield       Yield      Spread    Daily
                       (bid)       change     vs Bund   change
                                                        in
 Czech                                                  spread
 Republic                                               
   2-year                  0.1010     0.0380   +081bps     +5bps
   5-year                  0.3520    -0.1070   +106bps    -11bps
           <CZ10YT=RR      0.8100     0.0350   +128bps     +3bps
 10-year   >                                            
 Poland                                                         
   2-year                  0.1500    -0.0030   +086bps     +0bps
   5-year                  0.7500     0.0190   +146bps     +1bps
           <PL10YT=RR      1.3690    -0.0110   +184bps     -2bps
 10-year   >                                            
           FORWARD                                              
                       3x6         6x9        9x12      3M
                                                        interban
                                                        k
 Czech             <P        0.29       0.29      0.31      0.34
 Rep       RIBOR=>                                      
 Hungary           <B        0.61       0.55      0.49      0.74
           UBOR=>                                       
 Poland            <W        0.22       0.23      0.24      0.26
           IBOR=>                                       
 Note:     are for ask prices                                   
 FRA                                                    
 quotes                                                 
 *****************************************************          
 *********                                              
 
 (Additional reporting by jason Hovet in Prague; Editing by
Kirsten Donovan)
  
 
 
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