April 30, 2020 / 10:50 AM / a month ago

CEE MARKETS-Forint rises to 10-day high as CEE currencies see stronger April

    PRAGUE, April 30 (Reuters) - Hungary's forint rose to a
10-day high on Thursday, leading central European currencies up
as economies reopen, setting them on track to post modest gains
in April after a hammering at the start of the coronavirus
outbreak in March.
    Currencies fell 5-7% in March when the new coronavirus
started spreading rapidly throughout Europe, leading to a
virtual lockdown of countries. But they have begun what analysts
have forecast will be a slow rebound over the next year.
    The forint had risen 0.5% to trade at 353.35 to the euro by
0955 GMT on Thursday, on course for a 2.4% rise in April.
    Elsewhere, the Czech crown nudged up to 27.108 per
euro and was set for a 1.1% rise in April. The Polish zloty
 was heading to a 0.5% April gain, up a quarter of a
percent on Thursday. Romania's leu was flat at 4.842.
    Hungarian central bank action in April has helped the
forint, including launching a new one-week deposit tool for
banks at 0.9% at the start of the month.
    The bank is also launching a bond-buying programme as it
tries to balance giving the economy a boost and preventing a
sell-off in the currency, which has been the most vulnerable to
investor mood in the region in recent years. 
    Markets have been more upbeat recently, helped by the start
of easing of restrictions on shops and daily life in the region
that had been put in place last month.
    On Thursday, global markets also got a boost from
encouraging early results from a COVID-19 treatment trial and
expectations of more European Central Bank (ECB) stimulus.
    Erste Bank said the forint could continue to firm past 350.
    Analysts still remained wary of gains coming too quickly,
especially as economic data in the coming weeks will paint a
dark picture. 
    "As economics matter for risky assets and exchange rates, we
remain on the cautious side after the recent relief rally in EM
FX," Raiffeisen said.    
    Budapest stocks rose over 2% while Prague was
flat. Czech bond yields were mixed, with yields on short-term
debt that has been most in demand falling while longer yields
rose.
    Czech Finance Ministry data on Thursday showed foreign
ownership of domestic bonds eased only slightly in March.

    The Czechs have been on a record borrowing spree to finance
a budget deficit that will climb to an all-time high this year,
although expectations the central bank will continue cutting
interest rates next week is helping demand for state debt.
    
                                        CEE      SNAPSHO   AT                      
                                        MARKETS  T        1155              
                                                          CET               
                                                                                   
                                        CURRENC                                    
                                        IES                                 
                                                 Latest   Previou  Daily    Change
                                                          s                 
                                                 bid      close    change   in 2020
 EURCZK=                      Czech     <EURCZK  27.1080  27.1275   +0.07%   -6.18%
                              crown     =>                                  
 EURHUF=                      Hungary   <EURHUF  353.350  355.165   +0.51%   -6.28%
                              forint    =>             0        0           
 EURPLN=                      Polish    <EURPLN   4.5390   4.5504   +0.25%   -6.23%
                              zloty     =>                                  
 EURRON=                      Romanian  <EURRON   4.8420   4.8432   +0.02%   -1.11%
                              leu       =>                                  
 EURHRK=                      Croatian  <EURHRK   7.5750   7.5755   +0.01%   -1.71%
                              kuna      =>                                  
 EURRSD=                      Serbian   <EURRSD  117.530  117.680   +0.13%   +0.03%
                              dinar     =>             0        0           
                              Note:     calcula                    1800            
                              daily     ted                        CET      
                              change    from                                
                                                                                   
                                        STOCKS                                     
                                                 Latest   Previou  Daily    Change
                                                          s                 
                                                          close    change   in 2020
 .PX                          Prague              884.99  883.950   +0.12%  -20.67%
                                                                0           
 .BUX                         Budapest           35777.0  34815.0   +2.76%  -22.36%
                                                       8        9           
 .WIG20                       Warsaw    <.WIG20  1668.63  1651.33   +1.05%  -22.39%
                                        >                                   
 .BETI                        Buchares           8252.31  8274.76   -0.27%  -17.29%
                              t                                             
 .SBITOP                      Ljubljan  <.SBITO   802.35   791.22   +1.41%  -13.34%
                              a         P>                                  
 .CRBEX                       Zagreb    <.CRBEX  1551.61  1558.38   -0.43%  -23.09%
                                        >                                   
 .BELEX15                     Belgrade  <.BELEX   657.57   655.30   +0.35%  -17.98%
                                        15>                                 
 .SOFIX                       Sofia     <.SOFIX   447.04   449.39   -0.52%  -21.32%
                                        >                                   
                                                                                   
                                        BONDS                                      
                                                 Yield    Yield    Spread   Daily
                                                 (bid)    change   vs Bund  change
                                                                            in
                              Czech                                         spread
                              Republic                                      
 CZ2YT=RR                       2-year  <CZ2YT=   0.7140   0.0490   +144bp    +7bps
                                        RR>                              s  
 CZ5YT=RR                       5-year  <CZ5YT=   0.9680  -0.0730   +166bp    -5bps
                                        RR>                              s  
 CZ10YT=RR                              <CZ10YT   1.3690   0.0650   +189bp   +10bps
                              10-year   =RR>                             s  
                              Poland                                               
 PL2YT=RR                       2-year  <PL2YT=   0.5820  -0.0030   +131bp    +1bps
                                        RR>                              s  
 PL5YT=RR                       5-year  <PL5YT=   1.0360   0.0000   +173bp    +3bps
                                        RR>                              s  
 PL10YT=RR                              <PL10YT   1.4950   0.0250   +201bp    +6bps
                              10-year   =RR>                             s  
                                                                                   
                                        FRA                                        
                                                 3x6      6x9      9x12     3M
                                                                            interba
                                                                            nk
                              Czech     <CZKFRA     0.30     0.29     0.33     0.90
                              Rep       ><PRIBO                             
                                        R=>                                 
                              Hungary   <HUFFRA     1.18     1.12     1.08     1.09
                                        ><BUBOR                             
                                        =>                                  
                              Poland    <PLNFRA     0.23     0.19     0.21     0.69
                                        ><WIBOR                             
                                        =>                                  
                              Note: FRA quotes                                     
                              are for ask                                   
                              prices                                        
                              ********************************************         
                              ******************                            
                                                                                   
    

 (Reporting by Jason Hovet in Prague and Anita Komuves in
Budapest; Editing by Emelia Sithole-Matarise)
  
 
 
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