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3 months ago
CEE MARKETS-Currencies firm ahead of GDP data, some stocks retreat
May 15, 2017 / 9:29 AM / 3 months ago

CEE MARKETS-Currencies firm ahead of GDP data, some stocks retreat

    * Stock indices at multi-year high before profit-taking
    * Strong Q1 GDP data expected, corporate earnings healthy
    * Forint, Czech crown touch 5-week highs
    * Romanian central bank cuts inflation forecasts

 (Recasts with rise of currencies, new quotes)
    By Sandor Peto
    BUDAPEST, May 15 (Reuters) - Central European currencies
firmed on Monday on expectations that first-quarter regional
economic output data due on Tuesday will show robust growth,
though profit-taking caused some retreat in the region's stock
markets.
    The forint, the zloty and the crown
 firmed 0.3-0.4 percent against the euro by 1339 GMT.
    The crown, touching 26.455, hit its strongest levels since
the Czech central bank last month removed its cap which had kept
the currency weaker than 27 for years.
    "The global mood is quite good, currencies in other emerging
markets like South Africa are also strengthening," one
Budapest-based trader said.
    "Tomorrow's GDP figures could even lift regional currencies
further, and 308-308.50 is within shooting range for the
forint."
    The Hungarian unit traded around 309, at 5-week highs.
    Budapest stocks gave up ground due to profit-taking, after
reaching a record high in early trade.
    Bucharest stocks, however, set a new 9-year high after
gaining half a percent and Prague equities touched a new
21-month high.
    The leu, easing a shade, continued to underperform
regional peers, even though Romania is expected to release the
highest annual economic growth figure in the region early on
Tuesday, at 4.4 percent.   
    Hungary is expected to report 3.35 percent annual economic
growth for the first quarter on Tuesday, Poland 3.9 percent and
the Czech Republic a pick-up to 2.3 percent. 
    Regional central banks have not showed signs that they will
start to tighten policies any time soon, despite robust growth
in the region and a retreat in inflation last month, following a
surge since 2016. 
    Investors have been worried that the leftist Romanian
government's drive to boost wages and cut taxes could widen the
country's budget deficit and lift inflation.   
    Romania's central bank may slightly delay an expected
tightening of monetary policy, Governor Mugur Isarescu said on
Monday after it trimmed its inflation forecasts for this year
and next.            
    
             CEE        SNAPS   AT  1539          
             MARKETS    HOT    CET           
                        CURRENCIES                
                        Lates  Previ  Daily  Chang
                        t      ous           e
                        bid    close  chang  in
                                      e      2017
 Czech                  26.50  26.58   +0.3  1.91%
 crown                     00     05     0%  
 Hungary                308.8  309.9   +0.3  -0.01
 forint                   500    650     6%      %
 Polish                 4.198  4.217   +0.4  4.89%
 zloty                      5      0     4%  
 Romanian               4.550  4.548  -0.05  -0.34
 leu                        5      0      %      %
 Croatian               7.431  7.428  -0.03  1.67%
 kuna                       0      5      %  
 Serbian                123.0  123.2   +0.1  0.28%
 dinar                    000    000     6%  
 Note:       calculate  previ  close  1800        
 daily       d from     ous    at     CET    
 change                                      
                        STOCK                     
                        S                    
                        Lates  Previ  Daily  Chang
                        t      ous           e
                               close  chang  in
                                      e      2017
 Prague                 1018.  1017.   +0.0   +10.
                           80     96     8%    55%
 Budapest               34387  34435  -0.14   +7.4
                          .37    .53      %     5%
 Warsaw                 2371.  2368.   +0.1   +21.
                           98     50     5%    77%
 Bucharest              8446.  8407.   +0.4   +19.
                           92     67     7%    22%
 Ljubljana              780.8  782.6  -0.23   +8.8
                            9      8      %     2%
 Zagreb                 1864.  1885.  -1.10  -6.54
                           44     17      %      %
 Belgrade    <.BELEX15  728.8  725.9   +0.4   +1.6
             >              3      0     0%     0%
 Sofia                  655.8  654.9   +0.1   +11.
                            2      7     3%    83%
                        BONDS                     
                        Yield  Yield  Sprea  Daily
                                      d      
                        (bid)  chang  vs     chang
                               e      Bund   e in
 Czech                                       sprea
 Republic                                    d
   2-year    <CZ2YT=RR  -0.09  0.041   +058   +4bp
             >              2           bps      s
   5-year    <CZ5YT=RR      0  0.028   +031   +1bp
             >                          bps      s
   10-year   <CZ10YT=R  0.819      0   +040  -2bps
             R>                         bps  
 Poland                                           
   2-year    <PL2YT=RR  1.984  0.002   +266   +0bp
             >                          bps      s
   5-year    <PL5YT=RR  2.811  0.023   +312   +1bp
             >                          bps      s
   10-year   <PL10YT=R   3.35  0.026   +293   +0bp
             R>                         bps      s
             FORWARD    RATE   AGREEMENT          
                        3x6    6x9    9x12   3M
                                             inter
                                             bank
 Czech Rep           <   0.35   0.43   0.53      0
             PRIBOR=>                        
 Hungary             <    0.2   0.24   0.32   0.16
             BUBOR=>                         
 Poland              <  1.752  1.779  1.817   1.73
             WIBOR=>                         
 Note: FRA   are for                              
 quotes      ask                             
             prices                          
 *************************************************
 *************
 
    

 (Additional reporting by Jan Lopatka in Prague; Editing by
Raissa Kasolowsky and Ed Osmond)
  

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