April 23, 2019 / 10:11 AM / a month ago

CEE MARKETS-Zloty eases slightly as Polish retail sales growth slows

    * Polish retail sales slow in March on Easter effect
    * Zloty, forint ease slightly, euro remains under pressure
    * Bond yields track Bunds higher

    By Sandor Peto and Alan Charlish
    BUDAPEST/WARSAW, April 23 (Reuters) - Central Europe's main
currencies eased slightly on Tuesday as retail sales growth in
Poland slowed more than expected in March.
    The region's most liquid units, the zloty and the
forint, each fell 0.1 percent by 0852 GMT.
    They did not follow a strengthening of the rouble driven by
a rise in crude prices.
    The region's economies are oil importers, and are linked to
the euro which remains under pressure after last week's
weak euro zone purchasing managers' index figures.
    Poland's annual retail sales growth slowed more than
expected to 3.1 percent in March.
    A more than 20 percent surge in spending on durable goods,
however, indicated that consumer demand remained robust,
analysts said.
    "Shops were closed on 4 out of 5 Sundays in the month and
secondly ... Easter was later this year than last year, shifting
increased purchases into April," said Monika Kurtek, Chief
Economist if Bank Pocztowy, explaining the March slowdown.
    The zloty, trading at 4.2879 versus the euro, was still
firmer than its 200- and 90-day moving averages at 4.297.
    The forint traded at 320.7, staying near the 320
line where it has been hovering since late last month when the
Hungarian central bank gave up its earlier guidance of gradual
monetary tightening.
    "I do not expect the bank to do anything at its meeting next
week," Raiffeisen analyst Zoltan Torok said.
    While regional stocks mostly eased slightly, government
bonds tracked a rise in Bund yields.
    Poland's 10-year yield rose 2 basis points to 2.893 from
April 18, the last session before the Easter holidays.
    Moody's affirmed Poland's 'A2' rating and maintained a 
stable outlook on Friday, saying it did not expect a planned
increase in public spending around Polish elections late this
year to worsen the outlook.
    The agency could upgrade both Croatia and Slovenia in
reviews due on Friday as the two European Union members'
economic and fiscal performance is strong, Raiffeisen analyst
Gintaras Shlizhyus said in a note.
    "In Croatia we remain on Hold due to tight Eurobond
valuations though, strategically speaking, Croatia can become
next EU-convergence play if its plan to file the ERM-2
application this year gets the EU support," he added.
    The kuna firmed 0.1 percent versus the euro to
7.424.
    
            CEE       SNAPSHOT   AT                         
            MARKETS             1052 CET            
                      CURRENCI                              
                      ES                            
                      Latest    Previous  Daily     Change
                      bid       close     change    in 2019
 Czech      <EURCZK=   25.7240   25.7150    -0.03%    -0.07%
 crown      >                                       
 Hungary    <EURHUF=  320.7500  320.3900    -0.11%    +0.10%
 forint     >                                       
 Polish     <EURPLN=    4.2879    4.2838    -0.10%    +0.04%
 zloty      >                                       
 Romanian   <EURRON=    4.7575    4.7570    -0.01%    -2.18%
 leu        >                                       
 Croatian   <EURHRK=    7.4240    7.4305    +0.09%    -0.19%
 kuna       >                                       
 Serbian    <EURRSD=  117.8900  118.0100    +0.10%    +0.35%
 dinar      >                                       
 Note:      calculated from               1800 CET          
 daily                                              
 change                                             
                                                            
                      Latest    Previous  Daily     Change
                                close     change    in 2019
 Prague                1098.17  1101.670    -0.32%   +11.31%
                                       0            
 Budapest             42726.74  42810.11    -0.19%    +9.17%
 Warsaw                2368.42   2365.36    +0.13%    +4.03%
 Bucharest             8383.03   8402.88    -0.24%   +13.53%
 Ljubljana  <.SBITOP    880.20    879.35    +0.10%    +9.44%
            >                                       
 Zagreb                1820.86   1818.63    +0.12%    +4.12%
 Belgrade   <.BELEX1    749.00    748.34    +0.09%    -1.67%
            5>                                      
 Sofia                  572.92    575.29    -0.41%    -3.62%
                      BONDS                                 
                      Yield     Yield     Spread    Daily
                      (bid)     change    vs Bund   change
                                                    in
 Czech                                              spread
 Republic                                           
   2-year   <CZ2YT=R    1.7260   -0.1080   +231bps    -12bps
            R>                                      
   5-year   <CZ5YT=R    1.7180    0.0340   +210bps     +2bps
            R>                                      
   10-year  <CZ10YT=    1.8430    0.0020   +179bps     -3bps
            RR>                                     
 Poland                                                     
   2-year   <PL2YT=R    1.6200   -0.0850   +220bps     -9bps
            R>                                      
   5-year   <PL5YT=R    2.2300    0.0110   +261bps     +0bps
            R>                                      
   10-year  <PL10YT=    2.9110    0.0220   +286bps     -1bps
            RR>                                     
            FORWARD   RATE      AGREEMEN                    
                                T                   
                      3x6       6x9       9x12      3M
                                                    interban
                                                    k
 Czech Rep                2.19      2.21      2.20      2.02
            <PRIBOR=                                
            >                                       
 Hungary                  0.32      0.45      0.64      0.16
                                                    
 Poland                   1.75      1.76      1.77      1.72
                                                    
 Note: FRA  are for ask prices                              
 quotes                                             
 *************************************************          
 *************                                      
 
 (Reporting by Sandor Peto
Editing by Andrew Heavens)
  
 
 
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