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CEE MARKETS-Forint hits two-month low as more easing anticipated
September 13, 2017 / 9:00 AM / 12 days ago

CEE MARKETS-Forint hits two-month low as more easing anticipated

    By Gergely Szakacs
    BUDAPEST, Sept 13 (Reuters) - The Hungarian forint hit a two-month
low on Wednesday, extending a weeks-long downward drift as investors looked to a
meeting next week at which the central bank is widely expected to loosen
monetary conditions further.
    At 0826 GMT, the forint was down 0.14 percent at 307.60 versus the euro.
    Central Europe's most dovish central bank (NBH) is widely expected to ease
further on Tuesday to combat what it sees as a still benign underlying inflation
picture.
    "The market is fully aware that the NBH can announce new measures
practically anytime that can prevent any forint strengthening," a Budapest-based
currency dealer said.
    A keynote speech by European Commission chief Jean-Claude Juncker, who urged
EU governments to take advantage of Brexit and an economic upswing to forge a
tighter union at the heart of world trade, had little immediate market impact.

    A move by the European Union's executive on Tuesday to step up legal action
against Warsaw over reforms affecting the judiciary sent the zloty to
a two-week low.
    The currency was down 0.14 percent in early trade on Wednesday.
    Analysts said they expected the zloty to rebound as the strong fundamentals
of Poland's economy -- the region's biggest -- come to the fore.
    "We would predict... some form of solution (to the EU/Poland dispute) to be
found over the coming months," added Wolfgang Ernst, analyst at RBI in Vienna.
    "This could open the way for some PLN (zloty) recovery as soon as investors
again focus more on the supportive economic picture in Poland."
                         CEE MARKETS       SNAPSHOT   AT  1026 CET                
                                           CURRENCIES                             
                                           Latest    Previous  Daily     Change
                                           bid       close     change    in 2017
 Czech crown                                26.1000   26.0935    -0.02%      3.48%
 Hungary forint                            307.6000  307.1700    -0.14%      0.40%
 Polish zloty                                4.2660    4.2600    -0.14%      3.23%
 Romanian leu                                4.6020    4.6010    -0.02%     -1.46%
 Croatian kuna                               7.4670    7.4516    -0.21%      1.18%
 Serbian dinar                             119.0700  119.2800    +0.18%      3.59%
 Note: daily change      calculated from   previous  close at  1800 CET           
                                           STOCKS                                 
                                           Latest    Previous  Daily     Change
                                                     close     change    in 2017
 Prague                                     1041.00   1036.08    +0.47%    +12.95%
 Budapest                                  38018.02  38076.88    -0.15%    +18.79%
 Warsaw                                     2510.15   2505.88    +0.17%    +28.86%
 Bucharest                                  8046.72   8009.44    +0.47%    +13.57%
 Ljubljana                                   803.72    803.40    +0.04%    +12.00%
 Zagreb                                     1863.88   1869.40    -0.30%     -6.56%
 Belgrade                                    728.41    728.53    -0.02%     +1.54%
 Sofia                                       691.75    694.58    -0.41%    +17.96%
                                           BONDS                                  
                                           Yield     Yield     Spread    Daily
                                           (bid)     change    vs Bund   change in
 Czech Republic                                                          spread
   2-year                                    -0.027         0   +070bps      +0bps
   5-year                                    -0.026         0   +031bps      +1bps
   10-year                                    0.969     0.009   +058bps      +2bps
 Poland                                                                           
   2-year                                     1.682    -0.009   +241bps      -1bps
   5-year                                     2.556     0.002   +289bps      +1bps
   10-year                                    3.202    -0.006   +281bps      +0bps
                         FORWARD           RATE      AGREEMENT                    
                                           3x6       6x9       9x12      3M
                                                                         interbank
 Czech Rep                       <PRIBOR=      0.73      0.87      0.97          0
                         >                                               
 Hungary                                       0.09      0.11      0.14       0.13
 Poland                                      1.7575     1.775      1.81       1.73
 Note: FRA quotes        are for ask                                              
                         prices                                          
 

 (Reporting by Reuters bureaux; Writing by Gergely Szakacs, editing by John
Stonestreet)
  
 
 

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