Policymakers for now are holding steady on policy after sharp interest rate hikes taken mainly between 2021 and 2022. Czech central bank Vice-Governor Eva Zamrazilova said in the Prostor X podcast, published by the bank on Tuesday, that the current level of interest rates was high enough and rates will not go lower until inflation drops to single digits. In Hungary, the central bank is maintaining the European Union's highest base policy rate of 13%, along with a quick deposit rate of 18%, which is helping the forint. "High central bank interest rate, and a neutral market mood has driven the forint," a trader said, adding some selling pressure around the 370 per level might be expected.
"All in all, the swap difference, high interest and bad inflation data from last week linked up with hot money drives the forint today." The forint was 0.3% up at 371.25 to the euro at 0932 GMT, off a session high of 369.60. Inflation data last week showed price growth remained above 25% in March, indicating the slow path downward still to go. Inflation around central bank has remained elevated even as it gets past a peak. The crown gained 0.4% to 23.301 following Zamrazilova's comments, while Romania's leu and the zloty were steady, the latter having earlier hit as high as 4.622 to the euro. The rise in the zloty, mainly over the past week, has knocked it out of a previous trading range that had kept the currency relatively flat in 2023 while peers showed gains. Analysts, though, see a likely return to rangebound trading but at a stronger level, with local worries like whether Warsaw can free up European Union funds locked in disputes with Brussels can continue to weigh. "There are currently no premises that could support the Polish currency," Bank Millennium said.
"Though continued growth of the eurodollar this week remains an opportunity for the zloty, in our opinion it will be difficult for this to happen in the coming days."
CEE SNAPSHO AT
MARKETS T 1132
CET
CURRENC
IES
Latest Previou Daily Change s
bid close change in 2023
EURCZK Czech <EURCZK 23.3010 23.4020 +0.43% +3.68%
= crown =>
EURHUF Hungary <EURHUF 371.250 372.300 +0.28% +7.59%
= forint => 0 0
EURPLN Polish <EURPLN 4.6250 4.6255 +0.01% +1.40%
= zloty =>
EURRON Romanian <EURRON 4.9380 4.9385 +0.01% +0.09%
= leu =>
EURRSD Serbian <EURRSD 117.230 117.300 +0.06% +0.06%
= dinar => 0 0
Note: calcula 1800
daily ted CET
change from
Latest Previou Daily Change s
close change in 2023
.PX Prague 1411.22 1416.23 -0.35% +17.43
00 %
.BUX Budapest 44089.1 43827.0 +0.60% +0.67%
7 4
.WIG20 Warsaw <.WIG20 1901.50 1861.85 +2.13% +6.11%
>
.BETI Buchares 12511.0 12459.8 +0.41% +7.27%
t 6 5
.SBITO Ljubljan <.SBITO 1242.65 1238.63 +0.32% +18.48
P a P> %
.BELEX Belgrade <.BELEX 882.46 878.88 +0.41% +7.02%
15 15>
.SOFIX Sofia <.SOFIX 616.83 615.55 +0.21% +2.55%
>
Yield Yield Spread Daily
(bid) change vs Bund change
in
Czech spread
Republic
CZ2YT= 2-year <CZ2YT= 5.8120 0.0490 +293bp +4bps
RR RR> s
CZ5YT= 5-year <CZ5YT= 5.2120 -0.0800 +271bp -9bps
RR RR> s
CZ10YT <CZ10YT 4.8280 -0.0330 +235bp -3bps
=RR 10-year =RR> s
Poland
PL2YT= 2-year <PL2YT= 6.1550 0.0040 +327bp -1bps
RR RR> s
PL5YT= 5-year <PL5YT= 6.1410 -0.0160 +364bp -3bps
RR RR> s
PL10YT <PL10YT 6.1830 -0.0100 +371bp -1bps
=RR 10-year =RR> s
FORWARD
3x6 6x9 9x12 3M interba nk Czech <CZKFRA 7.19 6.93 6.34 7.18 Rep ><PRIBO
R=>
Hungary <HUFFRA 15.65 13.96 12.62 16.31 ><BUBOR
=>
Poland <PLNFRA 6.88 6.77 6.44 6.90 ><WIBOR
=>
Note: are for
FRA ask
quotes prices
***********************************
***************************
(Reporting by Jason Hovet in Prague, Boldizsar Gyori in Budapest, and Karol
Badohal in Warsaw; Editing by Shailesh Kuber)
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