April 15, 2019 / 10:23 AM / 4 months ago

CEE MARKETS-Forint tracks CEE FX rebound, off three-month low vs zloty

    * Forint tracks rebound in global risk-on mood
    * Hungarian construction data underpin GDP output growth
    * FX turnovers are low, stocks and bonds are range-bound

    By Sandor Peto
    BUDAPEST, April 15 (Reuters) - The forint gained on Monday,
benefiting from a global flow of money from safe-haven
currencies into more risky assets.
    Other Central European currencies like the zloty
had gained late on Friday as traders sold dollars.
    The euro also gained, and its strength helped currencies in
the European Union's eastern wing. A delay in Britain's exit
from the European Union helped sentiment.
    "The market has calmed down concerning Brexit and we are
also past the comments from the ECB and Fed: a calmer week
starts, which alone can justified some (forint) firming after a
weakening," one Budapest-based currency dealer said.
    The forint rose 0.2 percent against the euro to
320.8, moving to the stronger side of its 200-day moving average
for the first time in more than three weeks.
    Against the zloty, the Hungarian currency
rebounded from three-month lows set on Friday.
    The forint underperformed in recent weeks because rising
consumer prices across the region brought Hungary's annual
inflation near the top of the central bank's 2 to 4 percent
target range by March.
    The Polish rate, confirmed at 1.7 percent on Monday, is near
the bottom of its 1.5 to 3.5 percent target range.
    Hungary's central bank raised one of its interest rates on
March 26, but dropped its guidance of gradual monetary
tightening, saying that its policy would hinge on data.
    Hungarian construction output jumped by 48 percent in annual
terms in February, according to figures released on Monday.
    Along with a pick-up in industrial output and retail sales,
the figures indicate that annual economic growth may have
accelerated above 5 percent in the first quarter of the year,
Takarekbank analyst Gergely Suppan said in a note.
    Turnover in the region's currency markets, however, remains
quite low as other emerging markets provide better news pegs for
trading, dealers said.
    Regional equities, mirroring their Western European peers,
were range-bound and mixed, similar to government bonds.
    Yields on Romanian leu-denominated bonds were mixed, after
the finance ministry said late on Friday that the government
planned to tap foreign markets for further issues worth 5.25
billion euros ($5.94 billion) this year and next.
    The 10-year debt traded around 4.92 percent, up 1 basis
point, and the benchmark overnight interbank rate
was bid at its highest level in commercial banks' one-month
reserve period, at 3.26 percent.
            CEE       SNAPSHOT   AT                         
            MARKETS             1114 CET            
                      Latest    Previous  Daily     Change
                      bid       close     change    in 2019
 Czech      <EURCZK=   25.6250   25.6150    -0.04%    +0.32%
 crown      >                                       
 Hungary    <EURHUF=  320.8000  321.5000    +0.22%    +0.09%
 forint     >                                       
 Polish     <EURPLN=    4.2760    4.2776    +0.04%    +0.32%
 zloty      >                                       
 Romanian   <EURRON=    4.7614    4.7595    -0.04%    -2.26%
 leu        >                                       
 Croatian   <EURHRK=    7.4380    7.4345    -0.05%    -0.38%
 kuna       >                                       
 Serbian    <EURRSD=  118.0000  118.0000    +0.00%    +0.25%
 dinar      >                                       
 Note:      calculated from               1800 CET          
                      Latest    Previous  Daily     Change
                                close     change    in 2019
 Prague                1105.06  1104.470    +0.05%   +12.01%
 Budapest             42833.77  42940.74    -0.25%    +9.44%
 Warsaw                2361.50   2366.71    -0.22%    +3.73%
 Bucharest             8288.81   8267.38    +0.26%   +12.26%
 Ljubljana  <.SBITOP    887.18    881.14    +0.69%   +10.31%
 Zagreb                1805.76   1806.50    -0.04%    +3.26%
 Belgrade   <.BELEX1    737.61    736.32    +0.18%    -3.16%
 Sofia                  575.50    575.13    +0.06%    -3.19%
                      Yield     Yield     Spread    Daily
                      (bid)     change    vs Bund   change
 Czech                                              spread
   2-year   <CZ2YT=R    1.6860   -0.1350   +226bps    -14bps
   5-year   <CZ5YT=R    1.7000    0.0220   +207bps     +2bps
   10-year  <CZ10YT=    1.8420    0.0110   +178bps     +0bps
   2-year   <PL2YT=R    1.6700   -0.0040   +224bps     -1bps
   5-year   <PL5YT=R    2.2300   -0.0120   +260bps     -2bps
   10-year  <PL10YT=    2.9190    0.0060   +286bps     +0bps
            FORWARD   RATE      AGREEMEN                    
                      3x6       6x9       9x12      3M
 Czech Rep                2.16      2.20      2.19      2.02
 Hungary                  0.37      0.54      0.74      0.16
 Poland                   1.75      1.75      1.75      1.72
 Note: FRA  are for ask prices                              
 (Reporting by Sandor Peto, editing by Larry King)
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