By Jason Hovet

PRAGUE, Jan 5 (Reuters)The Czech crown retreated beyond the psychological 24 per euro level on Thursday, pulling back from a 12-year high, while Hungary’s forint continued to test four-month peaks as central European currencies remained positive to start the new year.

Stock markets also rose on Thursday, adding to 2%-4% gains posted so far in the first week of 2023.

In international bond markets, Hungary issued a total of $4.25 billion worth of dollar-denominated benchmark bonds, Finance Minister Mihaly Varga said on Thursday.

In Poland, the zloty waited on central bank Governor Adam Glapinski’s news conference after the monetary policy council left interest rates unchanged on Wednesday, with expectations of inflation soon slowing.

Markets have had a hot start to begin 2023 as easing gas prices and China’s emergence from its strict “zero-COVID” rules boost investor sentiment.

The crown EURCZK= on Wednesday broken 24 to the euro for the first time since early 2011, but it pulled back on Thursday, with some dealers thinking there is shrinking space for gains with a looming recession.

It traded at 24.008, down 0.1% on the day, at 0946 GMT.

“Economic factors – current account development, an economy likely in a mild recession, an expected drop in interest rates already this year – should not be acting in this direction for the crown,” Erste Group Bank said, adding early-year positioning in the past also led to gains that could not be held.

The Hungarian forint EURHUF= traded at 395.25 to the euro, up 0.2% and gaining already 1% in 2023, after falling the most in central Europe in 2022.

Poland’s zloty EURPLN= fell 0.2% to 4,674 per euro.

Polish central bank arguments for stable interest rates were bolstered by preliminary inflation data from December on Thursday showing a headline rate of 16.6%, below a forecast of 17.3%.

But analysts said more attention was being paid to US monetary policy after Federal Reserve minutes.

“The global market is partially influenced by the description from the last Fed meeting, which reiterated that US central bankers do not expect interest rate cuts in 2023,” Bank Millennium said.

EEC MARKETS

SNAPSHOT

AT 1046 CET

CURRENCIES

Latest

Previous

Daily

Change

bid

close

change

in 2023

EURCZK=

Czech crown

EURCZK=

24.0080

23.9750

-0.14%

+0.62%

EURHUF=

Hungarian forint

EURHUF=

395.2500

396.0000

+0.19%

+1.06%

EURPLN=

Polish zlotys

EURPLN=

4.6740

4.6645

-0.20%

+0.33%

EURO=

Romanian leu

EURO=

4.9300

4.9302

+0.00%

+0.25%

EURHRK=

Croatian kuna

EURHRK=

7.5330

7.5365

+0.05%

+0.05%

EURRSD=

Serbian dinar

EURRSD=

117.2600

117.3500

+0.08%

+0.03%

Notes: daily change

calculated from

1800 CET

Latest

Previous

Daily

Change

close

change

in 2023

.PX

Prague

.PX

1235.79

1230.0600

+0.47%

+2.83%

.BUX

Budapest

.BUX

45168.88

44937.01

+0.52%

+3.14%

.WIG20

Warsaw

.WIG20

1879.95

1855.05

+1.34%

+4.91%

.BEIT

Bucharest

.BEIT

12145.40

12065.04

+0.67%

+4.13%

.SBITOP

Ljubljana

.SBITOP

1061.61

1057.48

+0.39%

+1.22%

.BELEX15

Belgrade

.BELEX15

824.61

824.61

+0.00%

+0.00%

.SOFIX

Sofia

.SOFIX

603.24

603.42

-0.03%

+0.29%

Yield

Yield

Spread

Daily

(bid)

change

vs Bund

change in

Czech Republic

spread

CZ2YT=RR

2-year

CZ2YT=RR

5.5630

-0.0010

+294 bps

-4 bps

CZ5YT=RR

5 years

CZ5YT=RR

5.0950

-0.0650

+276 bps

-10 bps

CZ10YT=RR

10 years

CZ10YT=RR

4.9110

-0.0470

+261 bps

-7 bps

Poland

PL2YT=RR

2-year

PL2YT=RR

6.1190

-0.2830

+349 bps

-32 bps

PL5YT=RR

5 years

PL5YT=RR

6.0880

-0.2190

+375 bps

-25 bps

PL10YT=RR

10 years

PL10YT=RR

6.1780

-0.2090

+388 bps

-23 bps

FORWARD

3×6

6×9

9×12

3M interbank

Czech Rep

CZKFRAPRIBOR=

7.08

6.85

6.43

7.23

Hungary

HUFFRABUBOR=

14.32

12.77

11.32

16.19

Poland

PLNFRAWIBOR=

6.91

6.97

6.54

7.00

Notes: FRA quotas

are for asking prices

****************************************************** ************

(Reporting by Jason Hovet in Prague, Krisztina Than in Budapest, and Pawel Florkiewicz in Warsaw; Editing by Shounak Dasgupta)

((jason.hovet@thomsonreuters.com))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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