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CEE MARKETS-Forint hits five-month high before slight retreat, crown also pulls back

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By Jason Hovet PRAGUE, Jan 18 (Reuters) - Hungary's forint scaled a five-month high against the euro on Wednesday and the Czech crown tested a 12-year peak before both retreated somewhat as central European currencies largely moved sideways. On debt markets, investors looked to a Czech auction on Wednesday in which the Finance Ministry was offering short-term treasury bills denominated in euros, not crowns, for the first time. Stock markets mostly firmed, following European peers higher amid positive updates from company earnings.

In Hungary, the forint was up 0.2% at 395.15 to the euro in mid-morning trade after reaching as high as 393.30. The currency is 1.1% stronger so far in 2023 and has gained steadily since December, first getting a boost from Budapest's moves to unlock European Union funds frozen in a dispute over rule of law issues, and more recently lifted by easing gas prices and a weaker U.S. dollar. "Our EMFX factor framework has reduced the allocation to HUF while positioning is getting stretched. We still prefer to express our constructive HUF stance through relative value trades and remain short PLN/HUF," Morgan Stanley wrote in a note. Poland's zloty edged 0.3% lower, but stuck in ranges seen to start 2023. Analysts see range trading continuing. The crown also pulled off session highs approaching 23.920 to the euro, retreating alongside the forint, traders said. It traded at 23.98 to the euro, or 0.15% lower on the day, at 1003 GMT. Analysts have seen few impulses for further gains for the crown, which led central Europe in 2022 with a 3% rise. The Czech central bank has held steady on interest rates for the past half-year, and while policymakers have not ruled out a further hike, vice-Governor Eva Zamrazilova reiterated on Wednesday that a preemptive rate raise was not right. The Czech Finance Ministry was planning its first euro-denominated T-bill auction on Wednesday, with results due midday. It has already been offering government bonds in euros, issued under Czech law, to satisfy its foreign currency borrowing needs, and will begin doing the same for short-term debt. "Looking at comparable short-term EUR debt, we expect yields around 2.10–2.40 but with less confidence as Czech EUR T-BILLs are a novelty," Komercni Banka trade Marek Lesko said. CEE SNAPSHO AT





Latest Previou Daily Change s

bid close change in 2023 EURCZK Czech <EURCZK 23.9800 23.9450 -0.15% +0.74% = crown =>
EURHUF Hungary <EURHUF 395.150 396.000 +0.22% +1.09% = forint => 0 0
EURPLN Polish <EURPLN 4.7090 4.6960 -0.28% -0.41% = zloty =>
EURRON Romanian <EURRON 4.9345 4.9335 -0.02% +0.16% = leu =>
EURHRK Croatian <EURHRK 7.5330 7.5365 +0.05% +0.05% = kuna =>
EURRSD Serbian <EURRSD 117.320 117.355 +0.03% -0.02% = dinar => 0 0

Note: calculated from 1800

daily CET


Latest Previou Daily Change s

close change in 2023 .PX Prague 1278.81 1271.37 +0.59% +6.41% 00
.BUX Budapest 46680.2 46313.7 +0.79% +6.59% 0 0
.WIG20 Warsaw <.WIG20 1906.32 1904.51 +0.10% +6.38% >
.BETI Buchares 12078.8 11959.9 +0.99% +3.56% t 5 1
.SBITO Ljubljan <.SBITO 1103.93 1106.44 -0.23% +5.26% P a P>
.CRBEX Zagreb <.CRBEX 2068.14 2054.39 +0.67% +687.0 > 5% .BELEX Belgrade <.BELEX 832.01 843.22 -1.33% +0.90% 15 15>
.SOFIX Sofia <.SOFIX 616.31 616.48 -0.03% +2.46% >

Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic
CZ2YT= 2-year <CZ2YT= 5.6800 0.0160 +318bp -3bps RR RR> s
CZ5YT= 5-year <CZ5YT= 4.7260 -0.0280 +261bp -6bps RR RR> s
CZ10YT <CZ10YT 4.3280 0.0310 +223bp +3bps =RR 10-year =RR> s

PL2YT= 2-year <PL2YT= 5.9050 -0.1350 +340bp -18bps RR RR> s
PL5YT= 5-year <PL5YT= 5.9340 -0.0470 +382bp -8bps RR RR> s
PL10YT <PL10YT 5.9980 -0.0380 +390bp -4bps =RR 10-year =RR> s


3x6 6x9 9x12 3M interba nk Czech <CZKFRA 7.08 6.79 6.28 7.21 Rep ><PRIBO


Hungary <HUFFRA 14.09 12.08 11.03 16.03 ><BUBOR


Poland <PLNFRA 6.96 6.80 6.29 6.93 ><WIBOR


Note: are for ask

FRA prices



(Reporting by Jason Hovet in Prague, Anna Wlodarczak-Semczuk in Warsaw, and Krisztina Than in Budapest; Editing by Krishna Chandra Eluri)

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