CEE MARKETS-Zloty steadies before Polish rate call, Czech retail sales buck up crown

OTP Bank Nyrt.

05/06/2024 10:15

By Boldizsar  Gyori
       BUDAPEST, June 5 (Reuters) - Central European currencies
firmed on Wednesday with the zloty recovering its footing after
the past week's tumble from four-year highs ahead of a central
bank meeting expected to keep Polish rates on hold.
    Elsewhere, a continuing retail sales recovery in the Czech
Republic bucked up the crown, while Hungary's forint rebounded
from a more than one-month low hit in the previous session.
     The Polish zloty  EURPLN=  was trading at 4.31 to the euro
at 0846 GMT, up 0.1% from Tuesday's close when it ended around a
one-month low.
    Markets widely expect rate setters at the National Bank of
Poland (NBP) to hold fire on interest rates for an eighth
straight meeting when it decides on policy later in the day.
    "The NBP is the only central bank in the region where we
don't expect any rate cuts this year," ING said in a note.
    "The decision should garner little attention and the
spotlight will be more on the statement and especially
tomorrow's press conference."
    After touching multi-month or multi-year highs last month,
most central European currencies started June on the back foot. 
    Analysts forecast a slight weakening from current levels
over the next half-year, according to a Reuters poll published
on Wednesday 
    In the Czech Republic, data showed retail sales grew for a
fifth straight month in April, providing a further argument for
central bankers to go slow on interest rate cuts following a
return to real wage growth after a two-year decline.
    "Retail sales clearly confirm consumer demand is growing and
will continue to be the main support for Czech economic
development," Banka Creditas chief economist Petr Dufek said.
    "However, it is also raising the risk to demand-led
inflation, which is taking place in several services, so the
central bank should take the current good figures with a certain
level of caution. It is probably another argument for cutting
interest rates at a slower pace."
    The crown  EURCZK=  traded at 24.7, while the forint
 EURHUF=  firmed 0.13% to trade at 392.65, around levels last
seen in late-April.
    
                   CEE       SNAPSHO   AT                       
                   MARKETS   T        1046 CET           
                             CURRENC                            
                             IES                         
                             Latest   Previous  Daily    Change
                             bid      close     change   in 2024
 EURCZK=  Czech                                         
 EURHUF=  Hungary                 0                     
 EURPLN=  Polish                                        
 EURRON=  Romania                                       
                                                                
          Note:    calculat                     1800            
          daily    ed from                      CET      
          change                                         
                                                                
                             Latest   Previous  Daily    Change
                                      close     change   in 2024
 .PX      Prague    .PX      1540.64  1537.370   +0.21%   +8.95%
                                             0           
 .BUX     Budapes   .BUX     68756.9  68385.55   +0.54%   +13.42
          t                        3                           %
 .WIG20   Warsaw    .WIG20   2445.18   2433.81   +0.47%   +4.36%
 .BETI    Buchare   .BETI    17829.4  17699.42   +0.73%   +15.99
          st                       7                           %
                                                                
                                                Spread   Daily
                                                vs Bund  change
                                                         in
          Czech                                          spread
          Republi                                        
          c                                              
 CZ2YT=R                                            s  
 CZ5YT=R                                            s  
 CZ10YT=                                           s  
          Poland                                                
 PL2YT=R                                            s  
 PL5YT=R                                            s  
 PL10YT=                                           s  
          Note:    are for                                      
          FRA      ask                                   
          quotes   prices                                
          ************************************                  
          **************************                     
 
 (Reporting by Boldizsar Gyori in Budapest, additional reporting
by Jason Hovet in Prague and Pawel Florkiewicz in Warsaw,
editing by Christina Fincher)
 ((boldizsar.gyori@thomsonreuters.com;))
 
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