August 28, 2019 / 8:58 AM / 22 days ago

CEE MARKETS-Polish yields drop on balanced budget plan, Czech auction eyed

    PRAGUE, Aug 28 (Reuters) - Polish bond yields dropped on
Wednesday after the government approved plans to eliminate a
budget deficit next year for the first time in three decades.
Czech yields were mixed before the first auction in over a
month.
    Polish yields fell 2-6 basis points along the curve with
expectations of lower supply in the future, with a 10-year
benchmark down to 1.775%. first time since 1990.
    "A balanced budget will serve as an anchor for future
actions and could be treated as a positive information for
investors," Santander Bank Polska said in a note. It added
demand was strong in the mid- to long-end of the curve.
    In Czech markets, yields on the 5- to 10-year debt ticked
lower. The Finance Ministry will auction bonds due in 2023 and
2033 on Wednesday, and Komercni Banka rates trader Dalimil
Vyskovsky said a drop in interest rate swaps this week would
help drive demand for the longer bonds.
    The yield on that bond was steady in early
trading, bid at 1.166%.
    Currencies in the region weakened, led by a multi-month low
for the Hungarian forint. The forint was bid down at
329.79 to the euro at 0822 GMT, extending a losing streak this
month that has put it at a 13-month low.
    The National Bank of Hungary left interest rates unchanged
on Tuesday, as expected, amid slowing domestic inflation, a
worsening euro zone economic outlook and global monetary easing.
 Analysts expect Hungarian interest rates to remain
on hold this year and next, according to an August Reuters poll.
    Brokerage Equilor said the forint was still prone to further
weakening and could test the key psychological level of 330.
However, Raiffeisen analysts said the forint, which like other
currencies in the region has been caught up in worries over the
U.S.-China trade war, could eventually turn around this quarter.
    "Fundamentals in Hungary are supportive of the local
currency and hence, we believe that the forint will revert back
to our target of EUR/HUF 320 at end of the third quarter," the
bank said in a trading note. 
    
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1022              
                                     CET               
                            CURRENC                           
                            IES                        
                            Latest   Previou  Daily    Change
                                     s                 
                            bid      close    change   in 2019
 EURCZK  Czech     <EURCZK  25.8420  25.8335   -0.03%   -0.52%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  329.790  329.515   -0.08%   -2.64%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.3801   4.3783   -0.04%   -2.07%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.7365   4.7335   -0.06%   -1.74%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.4010   7.4023   +0.02%   +0.12%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.640  117.760   +0.10%   +0.56%
 =       dinar     =>             0        0           
         Note:     calculated from            1800            
         daily                                CET      
         change                                        
                                                              
                            Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in 2019
 .PX     Prague             1031.94  1034.13   -0.21%   +4.60%
                                          00           
 .BUX    Budapest           38961.5  39107.9   -0.37%   -0.45%
                                  8        4           
 .WIG20  Warsaw    <.WIG20  2099.08  2095.45   +0.17%   -7.80%
                   >                                   
 .BETI   Buchares           9233.36  9258.55   -0.27%   +25.05
         t                                                   %
 .SBITO  Ljubljan  <.SBITO   850.99   854.15   -0.37%   +5.81%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  1871.05  1872.87   -0.10%   +6.99%
                   >                                   
 .BELEX  Belgrade  <.BELEX   748.00   749.66   -0.22%   -1.80%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   572.99   572.87   +0.02%   -3.61%
                   >                                   
                            BONDS                             
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
                                                       in
         Czech                                         spread
         Republic                                      
 CZ2YT=    2-year  <CZ2YT=   1.0710   0.0310   +196bp    +3bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   0.7750  -0.0390   +169bp    -4bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   1.0270  -0.0090   +173bp    +0bps
 =RR     10-year   =RR>                             s  
         Poland                                               
 PL2YT=    2-year  <PL2YT=   1.5110  -0.0510   +240bp    -5bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   1.5810  -0.0210   +250bp    -2bps
 RR                RR>                              s  
 PL10YT            <PL10YT   1.7750  -0.0550   +248bp    -5bps
 =RR     10-year   =RR>                             s  
                   FORWARD  RATE     AGREEME                  
                                     NT                
                            3x6      6x9      9x12     3M
                                                       interba
                                                       nk
         Czech     <CZKFRA     2.08     1.86     1.67     2.14
         Rep       ><PRIBO                             
                   R=>                                 
         Hungary   <HUFFRA     0.27     0.30     0.30     0.26
                   ><BUBOR                             
                   =>                                  
         Poland    <PLNFRA     1.70     1.65     1.59     1.72
                   ><WIBOR                             
                   =>                                  
         Note:     are for ask                                
         FRA       prices                              
         quotes                                        
         ********************************************         
         ******************                            
                                                              
 

 (Reporting by Jason Hovet in Prague, Alan Charlish in Warsaw
and Krisztina Than in Budapest)
  
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below