CEE MARKETS-Sharp fall in Hungary's industry hits forint, crown hovers around 25 per euro
06/02/2024 09:56
PRAGUE, Feb 6 (Reuters) - Hungary's forint fell for a
third consecutive session on Tuesday, with a sharp drop in
industrial output in December showing the economy ending last
year in a rough condition.
Central Europe's currencies have already been facing a
firming U.S. dollar that is cutting risk appetite in the region
and knocked the forint and Polish zloty off of recent firming
paths.
The Czech crown, however, has been around 21-month lows as
markets weigh how quickly the country's central bank will ease
monetary policy when it meets this week for the first time since
it delivered the first interest rate cut in over three years in
December.
Poland's central bank, which meets on Tuesday and Wednesday,
is expected to extend a pause in its own easing cycle for a
fourth month.
The zloty EURPLN= , which was flat at 4.34 to the euro on
Tuesday, has fared better than peers in the region on
expectations of the extended rate-cut pause. It has hovered just
off a high beyond 4.30 hit in December, which was its strongest
level since early 2020.
In Hungary, the forint EURHUF= continued a recent slide,
easing 0.1% to 386.95 to the euro.
Data on Tuesday showed industrial output fell more than 13%
in December, its sharpest pace since 2020, and gave another
signal the Hungarian economy's recovery from recession will not
be quick.
"Weaker than expected performance implies that the
contribution of the sector to GDP was probably negative in
4Q23," Erste Group Bank said. "The outlook for a revival in the
short-term has remained rather unfavourable."
Central Europe's economies are counting on rebounding
consumer demand - now that inflation is easing back to targets -
to bolster growth this year and make up for manufacturing
weakness.
Central banks in the region, with the exception of Romania,
have started easing their monetary policies.
Markets are betting the Czech National Bank will follow up
December's 25 basis-point cut with a heftier 50 basis-point
move, although a slight majority of analysts forecast a tamer
move.
The crown EURCZK= inched down 0.1% on the day, to 24.986
per euro, staying on the firm side of the psychological 25 level
that it weakened past on Monday.
CEE SNAPSH AT
MARKETS OT 1019
CET
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 1457.9 1460.4 -0.17% +3.10%
2 600
.BUX Budapes .BUX 64921. 64830. +0.14 +7.10%
t 09 41 %
.WIG20 Warsaw <.WIG20 2336.1 2329.7 +0.28 -0.29%
> 8 2 %
.BETI Buchare .BETI 15697. 15697. +0.00 +2.13%
st 75 30 %
Spread Daily
vs change
Bund in
Czech spread
Republi
c
CZ2YT= ps
CZ5YT= 0 ps
CZ10YT 0 ps
Poland
PL2YT= 0 ps
PL5YT= 0 ps
PL10YT 0 ps
FORWARD
(Reporting by Jason Hovet in Prague, Boldizsar Gyori in
Budapest and Pawel Florkiewicz in Warsaw; Editing by Krishna
Chandra Eluri)
((jason.hovet@thomsonreuters.com))
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