April 30, 2018 / 9:33 AM / 7 months ago

CEE MARKETS-Czech crown eases in thin pre-holiday trade, other currencies steady

    * FX benefits from ECB comments, reversal of U.S. yield rise
    * Markets will be shut Tuesday for May 1 holiday
    * Crown eases to 3-1/2 month low, eyes on cenbank meeting 

    BUCHAREST/WARSAW, April 30 (Reuters) - The Czech crown fell
to a three-and-a-half-month low on Monday ahead of a meeting of
the country's central bank board on Thursday, while other
Central European currencies were steady in thin pre-holiday
trade. 
    Regional currencies marginally extended last week's gains
following benign economic signals from the United States and the
European Central Bank (ECB).
    Last week bonds and currencies in the region bounced back
from multi-week lows after the ECB played down concerns over
soft euro zone economic data and the U.S. 10-year Treasury yield
dipped below three percent.
    By 1410 GMT, the crown was down 0.26 percent at 25.549,
having hit 25.600 earlier, its lowest level since Jan 10. 
    The Czech central bank meeting on Thursday might pose some
additional risks to the crown, analysts say, as comments from
that meeting may point to a slower-than-expected further
tightening of monetary policy.
    "It's the end of the month, there is a (U.S.) Fed meeting
ahead, lower liquidity, a holiday tomorrow, perhaps the Czech
central bank meeting is also a factor ... Some of the normal
flow that would balance this is missing," a Prague-based trader
said.
     "We hit (25.)600, that is near the technical levels of 610
and 650, those should hold. This is a classic pattern for crown,
it bubbles along towards firmer levels, then drops suddenly."   
     
    Hungarian markets are closed on Monday and Tuesday, while
other regional markets that were open on Monday will also be
shut on Tuesday for the May 1 labour day holiday.
    "Nothing is going on now since people left for a long
weekend ... Europe is also weekending by the barbecue tomorrow,
so it's hard to expect any movements. No one is calling," one
dealer at a major bank in Warsaw said.
    All eyes on Wednesday will be on the release of Polish flash
inflation for April. According to a median of forecasts gathered
by Reuters, April inflation amounted to 1.5 percent year-on-year
and 0.4 percent month-on-month.
    Central European economies are growing robustly, but
inflation figures have been modest so far this year in most of
the region, except for Romania, where consumer prices hit a
five-year high of five percent last month.
    
            CEE       SNAPSHOT   AT                         
            MARKETS             1708 CET            
                      CURRENCI                              
                      ES                            
                      Latest    Previous  Daily     Change
                      bid       close     change    in 2018
 Czech      <EURCZK=   25.5580   25.4870    -0.28%    -0.06%
 crown      >                                       
 Hungary    <EURHUF=  313.5000  312.8000    -0.22%    -0.82%
 forint     >                                       
 Polish     <EURPLN=    4.2270    4.2172    -0.23%    -1.20%
 zloty      >                                       
 Romanian   <EURRON=    4.6620    4.6640    +0.04%    +0.38%
 leu        >                                       
 Croatian   <EURHRK=    7.4100    7.4175    +0.10%    +0.27%
 kuna       >                                       
 Serbian    <EURRSD=  118.0800  118.2000    +0.10%    +0.36%
 dinar      >                                       
 Note:      calculated from               1800 CET          
 daily                                              
 change                                             
                                                            
                      Latest    Previous  Daily     Change
                                close     change    in 2018
 Prague                1114.85  1124.160    -0.83%    +3.40%
                                       0            
 Budapest             38295.72  38295.72    +0.00%    -2.75%
 Warsaw                2296.32   2276.41    +0.87%    -6.70%
 Bucharest             8747.99   8780.22    -0.37%   +12.82%
 Ljubljana  <.SBITOP    841.75    841.28    +0.06%    +4.39%
            >                                       
 Zagreb                1809.60   1796.21    +0.75%    -1.81%
 Belgrade   <.BELEX1    738.50    737.49    +0.14%    -2.80%
            5>                                      
 Sofia                  658.11    658.20    -0.01%    -2.85%
                      BONDS                                 
                      Yield     Yield     Spread    Daily
                      (bid)     change    vs Bund   change
                                                    in
 Czech                                              spread
 Republic                                           
   2-year   <CZ2YT=R    0.7600   -0.1200   +133bps    -12bps
            R>                                      
   5-year   <CZ5YT=R    1.1990   -0.0110   +125bps     -1bps
            R>                                      
   10-year  <CZ10YT=    1.7300   -0.0170   +116bps     -2bps
            RR>                                     
 Poland                                                     
   2-year   <PL2YT=R    1.5220    0.0090   +209bps     +1bps
            R>                                      
   5-year   <PL5YT=R    2.3720    0.0210   +242bps     +2bps
            R>                                      
   10-year  <PL10YT=    3.0710    0.0370   +250bps     +3bps
            RR>                                     
            FORWARD   RATE      AGREEMEN                    
                                T                   
                      3x6       6x9       9x12      3M
                                                    interban
                                                    k
 Czech Rep                0.95      1.04      1.14      0.00
            <PRIBOR=                                
            >                                       
 Hungary                  0.07      0.11      0.17      0.04
                                                    
 Poland                   1.72      1.73      1.75      1.70
                                                    
 Note: FRA  are for ask prices                              
 quotes                                             
 *************************************************          
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 (Reporting by Radu Marinas and Marcin Goclowski
Editing by Gareth Jones)
  
 
 
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