CEE MARKETS-Forint rebounds from 7-week low, stocks get some relief

(Updates with Forint rebound) By Jason Hovet and Krisztina Than PRAGUE, March 14 (Reuters) - Hungary's forint rebounded from a seven-week low on Tuesday, while the Czech crown hit its lowest since early February before recovering slightly, with markets staying nervous after the collapse of Silicon Valley Bank (SVB) last week. Markets were hit hard on Monday after the failure of SVB and New York's Signature Bank over the weekend even after the U.S. government took steps to shore up systemic confidence. The market rout undid weeks of gains for central Europe's currencies and cut much of the rise seen so far in 2023 that had pushed currencies to multi-month or multi-year highs. On Tuesday, though, assets recovered some ground, with the U.S. inflation data aiding bets of smaller Federal Reserve rate hike at its next meeting, lifting stocks both globally and in central Europe. The forint also climbed over 1% in the more upbeat mood after touching lows in the morning. "There was a bit of relief globally," a Prague-based trader said. The forint hit its highest since April 2022 at below 380 to the euro to start March but had fallen as much as over 3% since Monday. It traded 1.1% stronger on the day at 388.85 to the euro by 1450 GMT after cutting morning losses. The forint has faced the added pressure of a bubbling policy dispute between the Hungarian central bank and government, with the latter wanting policy easing as the economy weakens. Hungary's base rate is the highest in the European Union as the bank battles inflation that is hovering above 20%. Fears of a potential banking crisis after SVB's collapse caused global markets to scale back expectations of U.S. rate hikes, which can impact policy outlooks in central Europe, where rate-setters are holding steady now after sharp hiking cycles in 2021-2022. Elsewhere in currency markets, the Polish zloty steadied at 4.685 per euro, while the Czech crown came back from nearly half a percent loss in the morning to be flat on the day at 23.748. Czech retail sales slipped for a ninth consecutive month in January, data showed earlier on Tuesday, as high inflation continued to hit consumer demand, a factor that tipped the economy into technical recession in the fourth quarter.

CEE SNAPSHO AT

MARKETS T 1550

CET

CURRENC

IES

Latest Previou Daily Change s

bid close change in 2023 EURCZK Czech <EURCZK 23.7480 23.7400 -0.03% +1.73% = crown =>
EURHUF Hungary <EURHUF 388.850 393.100 +1.09% +2.72% = forint => 0 0
EURPLN Polish <EURPLN 4.6850 4.6845 -0.01% +0.10% = zloty =>
EURRON Romanian <EURRON 4.9230 4.9185 -0.09% +0.40% = leu =>
EURHRK Croatian <EURHRK 7.5330 7.5365 +0.05% +0.05% = kuna =>
EURRSD Serbian <EURRSD 117.200 117.300 +0.09% +0.09% = dinar => 0 0

Note: calculated from 1800

daily CET

change

Latest Previou Daily Change s

close change in 2023 .PX Prague 1357.83 1346.18 +0.87% +12.99 00 % .BUX Budapest 42144.7 41797.8 +0.83% -3.77% 2 1
.WIG20 Warsaw <.WIG20 1761.50 1753.30 +0.47% -1.70% >
.BETI Buchares 12369.9 12255.1 +0.94% +6.06% t 1 9
.SBITO Ljubljan <.SBITO 1188.62 1184.09 +0.38% +13.33 P a P> % .BELEX Belgrade <.BELEX 894.51 894.45 +0.01% +8.48% 15 15>
.SOFIX Sofia <.SOFIX 625.94 625.09 +0.14% +4.06% >

Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic
CZ2YT= 2-year <CZ2YT= 5.5100 -0.3280 +255bp -59bps RR RR> s
CZ5YT= 5-year <CZ5YT= 5.0100 -0.0190 +245bp -25bps RR RR> s
CZ10YT <CZ10YT 4.6880 0.0670 +223bp -11bps =RR 10-year =RR> s

Poland
PL2YT= 2-year <PL2YT= 6.0090 -0.0180 +305bp -28bps RR RR> s
PL5YT= 5-year <PL5YT= 6.1410 0.1490 +358bp -8bps RR RR> s
PL10YT <PL10YT 6.2100 0.1950 +376bp +2bps =RR 10-year =RR> s

FORWARD

3x6 6x9 9x12 3M interba nk Czech <CZKFRA 7.12 6.83 6.27 7.20 Rep ><PRIBO

R=>

Hungary <HUFFRA 14.95 13.42 12.22 16.30 ><BUBOR

=>

Poland <PLNFRA 6.88 6.72 6.25 6.92 ><WIBOR

=>

Note: are for ask

FRA prices

quotes

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

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