May 26, 2017 / 9:26 AM / 2 months ago

CEE MARKETS-Assets tread water as investors look to U.S. data for clues

7 Min Read

    By Marton Dunai
    BUDAPEST, May 26 (Reuters) - Emerging European currencies
moved in narrow ranges in early Friday trading and stocks were
mildly stronger as investors expected U.S. data later in the day
to give a clearer direction to flows.
    "We expect uncertain trading until the afternoon U.S. data,"
brokerage Equilor wrote in a note to clients in Budapest. "The
U.S. GDP could set the direction for European trading."
    The preliminary GDP reading surprised on the downside and
although it is expected to be revised higher, the Federal
Reserve struck a cautious tone. Slower rate hikes could drive
investors toward higher-yielding assets in emerging markets.
    "The Wednesday Fed minutes showed policymakers were split
about the optimum rate hike pace, and several of them hinge the
further rate trajectory on incoming data, so it is worthwhile
watching today's data closely," Equilor added.
    On Friday morning currencies were mostly flat, with the
Polish zloty's 0.1 percent fall the largest move in the region.
Stocks were also little moved, with Warsaw down 0.9 percent
after leading a rise in the previous session.
    Poland's finance minister said on Thursday that the 2017
budget deficit will be lower than the planned 59.4 billion
zloty, but its size depends on how many people take advantage of
a lower retirement age in the autumn.
    Finance minister Mateusz Morawiecki also said in an
interview at the Reuters Central & Eastern Europe Investment
Summit that he expects no changes to taxation next year and the
deficit forecast for 2018 is likely to be lower than 2017.
    Czech Prime Minister Bohuslav Sobotka also addressed the
summit to say Prague must narrow a wage gap with west European
states and should strive to join the euro, adding that the path
to higher living standards would be the main issue in elections
this year.
    Sobotka has presided over a period of strong economic
growth, low borrowing costs and rising wages, but his Social
Democrat party faces a tough task to beat the rival ANO movement
of former finance minister Andrej Babis in the parliamentary
election, due in October.
    The Czech Republic, a safe-haven market throughout the
recent economic crisis, may be the first market to see a rate
hike later this year, bucking a trend of years of record low
interest rates and loose monetary policy regionwide.

    
    
               CEE MARKETS  SNAPSH   AT  1051 CET         
                            OT                      
                            CURRENCIES                    
                            Latest  Previo  Daily   Change
                                    us              
                            bid     close   change  in
                                                    2017
 Czech crown                26.437  26.444   +0.03   2.16%
                                 0       5       %  
 Hungary                    307.10  307.31   +0.07   0.56%
 forint                         00      50       %  
 Polish zloty               4.1771  4.1759  -0.03%   5.43%
 Romanian leu               4.5540  4.5513  -0.06%  -0.42%
 Croatian                   7.4275  7.4295   +0.03   1.72%
 kuna                                            %  
 Serbian                    122.59  122.69   +0.08   0.62%
 dinar                          00      00       %  
 Note: daily   calculated   previo  close   1800          
 change        from         us      at      CET     
                            STOCKS                        
                            Latest  Previo  Daily   Change
                                    us              
                                    close   change  in
                                                    2017
 Prague                     1013.4  1009.9   +0.34   +9.96
                                 4       7       %       %
 Budapest                   34364.  34349.   +0.04   +7.38
                                41      11       %       %
 Warsaw                     2337.6  2358.4  -0.88%   +20.0
                                 4       1              1%
 Bucharest                  8621.8  8590.1   +0.37   +21.6
                                 5       8       %      9%
 Ljubljana                  788.60  791.12  -0.32%   +9.90
                                                         %
 Zagreb                     1853.9  1853.0   +0.04  -7.06%
                                 2       9       %  
 Belgrade                   731.21  736.47  -0.71%   +1.93
                                                         %
 Sofia                      661.53  658.50   +0.46   +12.8
                                                 %      1%
                            BONDS                         
                            Yield   Yield   Spread  Daily
                            (bid)   change  vs      change
                                            Bund    in
 Czech                                              spread
 Republic                                           
   2-year                   -0.117   0.065   +056b   +7bps
                                                ps  
   5-year                   -0.056  -0.004   +032b   +0bps
                                                ps  
   10-year                    0.73  -0.117   +039b  -10bps
                                                ps  
 Poland                                                   
   2-year                    1.921   0.009   +260b   +2bps
                                                ps  
   5-year                    2.714  -0.038   +309b   -3bps
                                                ps  
   10-year                     3.3  -0.004   +296b   +1bps
                                                ps  
               FORWARD      RATE    AGREEMENT             
                            3x6     6x9     9x12    3M
                                                    interb
                                                    ank
 Czech Rep             <PR    0.36    0.43    0.52       0
               IBOR=>                               
 Hungary               <BU    0.18    0.22    0.28       0
               BOR=>                                
 Poland                <WI    1.77     1.8    1.83    1.73
               BOR=>                                
 Note: FRA     are for ask                                
 quotes        prices                               
 *********************************************************
 *****
 

 (Reporting by Marton Dunai; Editing by Toby Chopra)
  
 
 

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below