CEE MARKETS-Currencies stable, focus on Czech CPI ahead of rates decision

OTP Bank Nyrt.

05/08/2025 10:00

WARSAW, Aug 5 (Reuters) - Central European currencies were mostly stable on Tuesday, with investors analysing Czech inflation data ahead of a central bank interest rate decision on Thursday, while stock markets were mixed.

Czech inflation data did little to change expectations of a pause in rate cuts at the central bank's meeting this week.

"The inflation result does not change our view that the CNB (Czech National Bank) will leave interest rates unchanged this Thursday. Inflation remains elevated and driven by high growth in service prices," Unicredit economist Patrik Rozumbersky said.

"The persistence of high wage growth and high growth in apartment prices are among other inflation risks that raise the bar for rate cuts at the remaining CNB meetings until the end of the year."

Czech monetary policymakers are widely expected to hold rates steady on Thursday for a second straight meeting, and markets will be looking for any clues over whether the central bank's easing cycle is at or near an end.

Analysts in a Reuters poll last week saw scope for another rate cut later this year, although markets have priced out the chances.

The crown hit its strongest level against the euro towards the end of July, at 24.53, and has hovered near that mark since. It EURCZK= traded a touch lower at 24.5940 at 0807 GMT.

Other currencies in central Europe stayed relatively stable, with the Hungarian forint EURHUF= at 399.40 per euro and the Polish zloty EURPLN= at 4.2740, 0.1% higher on the day.

"In the case of EUR/PLN, we expect the sideways trend to continue in the short and medium term below the technical resistance levels at 4.2850," Bank PKO analysts said in a note.

Stock markets in the region were mixed, with the main Prague index .PX stable and the Warsaw stock exchange .WIG20 losing 0.13%, while the market in Budapest .BUX gained 0.4%, supported by bank OTP OTPB.BU.

OTP was up 0.3% after publishing its quarterly results.

"The events of the second quarter could not shake the bank's profit-generating capability, so instead of the expected 313.6 billion forints, consolidated net profit for the quarter came in at 330.2 billion forints," brokerage Equilor said.

"This corresponds to a 25.6 percent return on equity. It is worth recalling that the first quarter's result was weighed down by the booking of the full-year amount of several tax items, which totalled 123 billion forints."

CEE MARKETS SNAPSHOT AT 1007 CET
CURRENCIES
Latest trade
Previous close
Daily change
Change in 2025
Czech crown
EURCZK=
24.5940
24.5810
-0.05%
+2.50%
Hungary forint
EURHUF=
399.4000
399.3000
-0.03%
+3.01%
Polish zloty
EURPLN=
4.2740
4.2775
+0.08%
+0.07%
Romanian leu
EURRON=
5.0737
5.0721
-0.03%
-1.92%
Serbian dinar
EURRSD=
117.0800
117.1400
+0.05%
-0.11%
Note: daily change calculated from 1800 CET
STOCKS
Latest
Previous close
Daily change
Change in 2025
Prague
.PX
2242.16
2242.2600
-0.00%
+27.38%
Budapest
.BUX
101325.88
100945.26
+0.38%
+27.73%
Warsaw
.WIG20
2876.55
2880.23
-0.13%
+31.23%
Bucharest
.BETI
20270.97
20162.70
+0.54%
+21.23%
BONDS
Yield (bid)
Yield change
Spread vs Bund
Daily change in spread
Czech Rep 2-year
CZ2YT=RR
3.5230
-0.0010
+163bps
+0bps
Czech Rep 5-year
CZ5YT=RR
3.8260
-0.0090
+161bps
+0bps
Czech Rep 10-year
CZ10YT=RR
4.2780
-0.0030
+166bps
+1bps
Poland 2-year
PL2YT=RR
4.3250
0.0470
+243bps
+5bps
Poland 5-year
PL5YT=RR
4.8440
-0.0260
+263bps
-2bps
Poland 10-year
PL10YT=RR
5.4180
-0.0210
+280bps
-1bps
FORWARD RATE AGREEMENTS
3x6
6x9
9x12
3M interbank
Czech Rep
CZKFRA, PRIBOR=
3.52
3.47
3.45
3.51
Poland
PLNFRA, WIBOR=
4.44
4.03
3.74
4.93
Note: FRA quotes are for ask prices

 (Reporting by Jason Hovet in Prague, Kristina Than in Budapest, Pawel Florkiewicz and Anna Wlodarczak-Semczuk in Warsaw; Editing by Subhranshu Sahu)

 ((anna.wlodarczak@thomsonreuters.com;))