CEE MARKETS-Forint falls from five-month peak, zloty recovers from overnight drop

4ig.

19/01/2023 10:09

By Jason Hovet
       PRAGUE, Jan 19 (Reuters) - Hungary's forint fell from a
five-month peak on Thursday and the Polish zloty weakened past a
key level in overnight trading before recovering, with U.S.
recession worries tempering risk appetite in central Europe.
    Stock markets fell 0.5%-1.0% in the region, following
European peers lower. 
    The forint  EURHUF= , after touching its highest since
August in the previous session, lost 0.5% to trade at 395.40 to
the euro by 0951 GMT. It was off morning lows, helped by a
mid-morning recovery in the euro, the region's reference
currency.
    The Polish zloty  EURPLN=  was up 0.1% at 4.706 to the euro,
after bouncing off an overnight low of 4.751. The move follows
weeks of range-bound trading.
    "The EUR/PLN exchange rate broke (its) resistance at
4.7070..., opening technical space for further weakening of the
zloty," Bank Millennium said. 
    "The technical situation is becoming more and more important
as the events planned for today and tomorrow should not be a
source of market volatility."
    After a round of economic data to begin January, markets in
central Europe are increasingly taking cues from global markets.
    U.S. retail sales posted their biggest drop in 12 months in
December, hitting economic momentum in the country and rattling
emerging markets on Thursday.
    In central Europe, decades-high inflation at double-digit
rates - above 20% in Hungary's case - is raising recession
risks. 
    Central banks, though, after sharp hiking cycles started in
2021, have shifted into stable rates. That is coming at a time
when U.S. and euro zone central banks are tightening, which is
putting pressure on currencies through a reduced rate
differential.
    Markets may be underestimating planned rate hikes by the
European Central Bank, policymaker Klaas Knot said on Thursday.
    Despite this, easing gas prices have helped the region to
start 2023, with the Czech crown managing to scale 12-year
highs, boosted by added security of a central bank pledge to
intervene to prevent any strong weakening.
    The crown was down a touch at 23.96 per euro on Thursday,
off a high of 23.927 hit on Wednesday.
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1051              
                                     CET               
                            CURRENC                           
                            IES                        
                            Latest   Previou  Daily    Change
                                     s                 
                            bid      close    change   in 2023
 EURCZK  Czech                                       
 EURHUF  Hungary                0        0           
 EURPLN  Polish                                      
 EURRON  Romanian                                    
 EURHRK  Croatian                                    
 EURRSD  Serbian                0        0           
         Note:     calcula                    1800            
         daily     ted                        CET      
         change    from                                
                                                              
                            Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in 2023
 .PX     Prague     .PX     1270.93  1278.30   -0.58%   +5.76%
                                          00           
 .BUX    Budapest   .BUX    46428.1  46855.5   -0.91%   +6.02%
                                  0        8           
 .WIG20  Warsaw    <.WIG20  1892.11  1913.25   -1.10%   +5.59%
                   >                                   
 .BETI   Buchares   .BETI   12060.6  12077.2   -0.14%   +3.40%
         t                        6        1           
 .SBITO  Ljubljan  <.SBITO  1108.07  1108.41   -0.03%   +5.65%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  2062.83  2068.45   -0.27%   +685.0
                   >                                        3%
 .BELEX  Belgrade  <.BELEX   832.39   831.64   +0.09%   +0.94%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   614.77   613.54   +0.20%   +2.21%
                   >                                   
                                                              
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
                                                       in
         Czech                                         spread
         Republic                                      
 CZ2YT=    2-year                                s  
 CZ5YT=    5-year                                s  
 CZ10YT                                         s  
         Poland                                               
 PL2YT=    2-year                                s  
 PL5YT=    5-year                                s  
 PL10YT                                         s  
                   FORWARD                                    
                            3x6      6x9      9x12     3M
                                                       interba
                                                       nk
         Czech                                      
         Hungary                                     
         Poland                                      
         Note:     are for                                    
         FRA       ask                                 
         quotes    prices                              
         ***********************************                  
         ***************************                   
 (Reporting by Jason Hovet in Prague and Anna Wlodarczak-Semczuk
in Warsaw; Editing by Krishna Chandra Eluri)
 ((jason.hovet@thomsonreuters.com))
 
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