May 20, 2020 / 11:19 AM / 17 days ago

CEE MARKETS-FX move sideways, Czech bond sales ease

    PRAGUE, May 20 (Reuters) - Central Europe's currencies tread
water on Wednesday as investors weighed the economic impact of
the coronavirus outbreak amid doubts over the effectiveness of a
potential vaccine, while the Czech Republic eased its barrage on
debt markets. 
    With countries in the region gradually emerging from
months-long lockdowns, investors are expected to get a clearer
picture of the overall hit to the economy in the coming period.
    Poland, which began lockdown down measures in mid-March, saw
April corporate employment fall at its fastest rate since 2009,
according to statistics office data.
    "The data turned out to be much worse than expected," said
Piotr Piekos, senior economist at state Bank Pekao. "In April,
we saw a decline of around 150,000 full-time jobs, which was an
unprecedented scale." 
    The zloty took the figures in stride, edging down
about 0.1% on the day to 4.55 to the euro by 1038 GMT.
    Hungary's forint was mostly flat. 
    On Tuesday, the Hungarian central bank (MNB) bought 15
billion forints ($47 million) worth of government bonds from
local banks, the lowest since it launched weekly debt purchase
tenders two weeks ago, bolstering the currency.
    "Latest data suggest that MNB may be slightly tapering its
QE purchases already as better news has begun to arrive out of
Germany and Europe, and Hungary itself is gearing up to ease its
lockdown," Commerzbank wrote in a note.
    Prague led stock market gains, with anti-virus
software maker Avast up 1.5% before going
ex-dividend. Warsaw was near its highest level this
month, although the rest of the region was mixed.
    The Czech Finance Ministry sold a combined 9.7 billion
crowns ($386.78 million) of three bonds on Wednesday, lower than
in previous sales although demand held up.

    The country has been on a recording borrowing spree with
demand in debt markets strong amid central bank rate cuts.
Yields had dropped going into Wednesday's auction.
        
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1238              
                                     CET               
                                                              
                   CURRENC                                    
                   IES                                 
                            Latest   Previou  Daily    Change
                                     s                 
                            bid      close    change   in 2020
 EURCZK  Czech     <EURCZK  27.4400  27.4990   +0.22%   -7.32%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  350.200  350.135   -0.02%   -5.44%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.5520   4.5487   -0.07%   -6.49%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.8410   4.8428   +0.04%   -1.09%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.5760   7.5750   -0.01%   -1.72%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.550  117.570   +0.02%   +0.02%
 =       dinar     =>             0        0           
         Note:     calcula                    1800            
         daily     ted                        CET      
         change    from                                
                                                              
                   STOCKS                                     
                            Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in 2020
 .PX     Prague              874.46  868.920   +0.64%  -21.62%
                                           0           
 .BUX    Budapest           35429.2  35452.2   -0.06%  -23.12%
                                  1        1           
 .WIG20  Warsaw    <.WIG20  1652.43  1640.18   +0.75%  -23.15%
                   >                                   
 .BETI   Buchares           8360.65  8383.11   -0.27%  -16.20%
         t                                             
 .SBITO  Ljubljan  <.SBITO   815.95   815.84   +0.01%  -11.87%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  1580.27  1583.98   -0.23%  -21.67%
                   >                                   
 .BELEX  Belgrade  <.BELEX   675.34   672.72   +0.39%  -15.76%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   448.57   451.33   -0.61%  -21.05%
                   >                                   
                                                              
                   BONDS                                      
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
                                                       in
         Czech                                         spread
         Republic                                      
 CZ2YT=    2-year  <CZ2YT=   0.1190  -0.0220   +079bp    -2bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   0.3960  -0.0250   +106bp    -2bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   0.8080   0.0090   +128bp    +2bps
 =RR     10-year   =RR>                             s  
         Poland                                               
 PL2YT=    2-year  <PL2YT=   0.5490   0.0030   +122bp    +0bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   0.9250  -0.0010   +159bp    +0bps
 RR                RR>                              s  
 PL10YT            <PL10YT   1.3770  -0.0090   +185bp    +0bps
 =RR     10-year   =RR>                             s  
                                                              
                   FRA                                        
                            3x6      6x9      9x12     3M
                                                       interba
                                                       nk
         Czech     <CZKFRA     0.21     0.23     0.28     0.34
         Rep       ><PRIBO                             
                   R=>                                 
         Hungary   <HUFFRA     0.87     0.83     0.79     1.01
                   ><BUBOR                             
                   =>                                  
         Poland    <PLNFRA     0.40     0.35     0.35     0.68
                   ><WIBOR                             
                   =>                                  
         Note: FRA quotes                                     
         are for ask                                   
         prices                                        
         ********************************************         
         ******************                            
                                                              
 

 (Reporting by Jason Hovet in Prague, Anita Komuves in Budapest,
and Alan Charlish in Warsaw; Editing by Ramakrishnan M.)
  
 
 
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