CEE MARKETS-FX weighed down by stronger dollar with rate meetings on deck
05/02/2024 10:15
By Boldizsar Gyori
BUDAPEST, Feb 5 (Reuters) - A stronger dollar pressured
central Europe's currencies on Monday, knocking the Polish zloty
and Hungarian forint off recent highs and leading the Czech
crown to test a fresh 21-month low before interest rate meetings
in the region this week.
Eyes are largely on the Czech National Bank session on
Thursday as investors eye whether it will accelerate the pace of
rate cuts as inflation slows after it launched an easing cycle
in December. Before that, Poland's central bank is likely to
continue a pause in its own easing cycle on Wednesday.
Markets are split on whether the Czech central bank will cut
again by 25 basis points or opt for a bigger move of 50 bps.
"We see a slightly higher probability of a 25-basis-point
cut, as the Czech central bank may prefer to remain cautious
before seeing January’s inflation footprint," Erste Group Bank
analysts said in a note.
The Czech crown EURCZK= traded at 24.95 at 0911 GMT, down
less than 0.1% and off its low of 24.98 hit on Friday.
On stock markets, Prague's PX index .PX inched up to a
fresh 2-year high on Monday.
Elsewhere in the region, markets were driven by the strength
of the U.S. dollar as traders clawed back bets for aggressive
rate cuts by the Federal Reserve this year.
A U.S. jobs report last week far exceeding market
expectations reinforced Fed Chair Jerome Powell's statement that
a March rate cut is unlikely.
The Polish zloty EURPLN= traded at 4.327 to the euro, off
0.1% and falling a touch further from a seven-week high of
4.3065 hit last Thursday.
"The zloty remains strong - especially considering the
global appreciation of the dollar - but the 4.31 barrier remains
a possible limit within the current round of strengthening,"
Bank Millennium said in a note.
Hungary's forint EURHUF= traded sideways at 384.3, and was
off a nearly two-week high of 382.30 touched at the end of last
week.
CEE SNAPSH AT 1044 CET
MARKETS OT
CURREN
CIES
Latest Previo Daily Change
us
trade close change in 2024
EURCZK Czech 0 0
EURHUF Hungary 00 00 %
EURPLN Polish
EURRON Romania %
EURRSD Serbian 00 50 %
Note: calculated from 1800
daily CET
change
Latest Previo Daily Change
us
close change in 2024
.PX Prague .PX 1463.5 1457.3 +0.43 +3.50%
8 100 %
.BUX Budapes .BUX 65145. 65290. -0.22% +7.46%
t 14 31
.WIG20 Warsaw <.WIG20 2347.3 2350.4 -0.13% +0.18%
> 1 4
.BETI Buchare .BETI 15718. 15640. +0.49 +2.26%
st 02 73 %
Spread Daily
vs change
Bund in
Czech spread
Republi
c
CZ2YT= ps
CZ5YT= ps
CZ10YT ps
Poland
PL2YT= ps
PL5YT= ps
PL10YT 0 ps
FORWARD
(Reporting by Boldizsar Gyori in Budapest, Pawel Florkiewicz in
Warsaw and Jason Hovet in Prague; editing by Mark Heinrich)
((boldizsar.gyori@thomsonreuters.com))
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