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CEE MARKETS-Czech crown weakest since July on spike in virus cases

    WARSAW, Sept 15 (Reuters) - The Czech crown was at
its weakest level against the euro in over two months on
Tuesday, as a spike in the number of coronavirus infections in
the country spooked investors.
    The Czech Republic has seen one of Europe's largest surges
in new coronavirus cases in recent weeks, and on Tuesday the
Institute of Health Information and Statistics (UZIS) said the
reproduction 'R' number of COVID-19 infections had risen to
1.59.
    "It is still the same story: the market doesn't seem to like
the increasing COVID-19 cases. Longer-dated rates are on the way
down the last couple of days, so this is also playing in favour
of a negative move on the crown," said a Prague-based trader.
    At 0907 GMT, the crown was 0.31% softer against the euro on
the day at 26.75.
    The region's other currencies also fell ahead of an interest
rate decision in Poland on Tuesday and as the U.S. Federal
Reserve started a two-day policy meeting, the first since
unveiling a landmark shift to a more tolerant stance on
inflation in August. 
    The Polish zloty was 0.11% weaker at 4.4512 and
the Hungarian forint slipped 0.16% to 357.75.
    "The FOMC press release and the subsequent Fed chairman's
press conference are always a surprise risk," Konrad Bialas,
chief economist at DM TMS Brokers, said in a note.
    "Investors' caution also means that the readings from the
euro zone and the U.S. scheduled for today may not be fully
discounted - nobody wants to aggressively engage in positions
that the Fed may later send into the abyss of stop losses."
    Analysts expect Poland's central bank to leave the cost of
borrowing unchanged at the record-low level of 0.1%.
    "It is hard to imagine, in the light of the recent comments
of the NBP governor and the macro data, that the Council would
significantly modify its rhetoric," Bank Millennium analysts
said in a note.
    Stocks were mixed, with Prague's PX index rising 0.37% while
the main indexes in Budapest and Warsaw fell
1.14% and 0.55% respectively.
    BDM analyst Adrian Gorniak said one factor behind the drop
in Poland could be funds selling shares in order to be able to
invest in the upcoming IPO of Polish commerce platform Allegro.

    Benchmark Polish 10-year yields were flat at
1.367% while Czech 10-year yields fell over 3 basis points to
1.044%.
    
    
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1107              
                                     CET               
                                                              
                   CURRENC                                    
                   IES                                 
                            Latest   Previou  Daily    Change
                                     s                 
                            bid      close    change   in 2020
 EURCZK  Czech     <EURCZK  26.7500  26.6665   -0.31%   -4.93%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  357.750  357.165   -0.16%   -7.44%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.4512   4.4462   -0.11%   -4.38%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.8555   4.8560   +0.01%   -1.38%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.5355   7.5365   +0.01%   -1.20%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.480  117.580   +0.09%   +0.08%
 =       dinar     =>             0        0           
         Note:     calcula                    1800            
         daily     ted                        CET      
         change    from STOCKS                                     
                            Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in 2020
 .PX     Prague              902.07  898.700   +0.37%  -19.14%
                                           0           
 .BUX    Budapest           34606.1  35004.2   -1.14%  -24.90%
                                  0        4           
 .WIG20  Warsaw    <.WIG20  1749.05  1758.65   -0.55%  -18.65%
                   >                                   
 .BETI   Buchares           9337.36  9368.12   -0.33%   -6.41%
         t                                             
 .SBITO  Ljubljan  <.SBITO   844.68   844.24   +0.05%   -8.77%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  1613.08  1608.78   +0.27%  -20.04%
                   >                                   
 .BELEX  Belgrade  <.BELEX   690.70   690.55   +0.02%  -13.84%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   430.80   430.91   -0.03%  -24.17%
                   > BONDS                                      
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
                                                       in
         Czech                                         spread
         Republic                                      
 CZ2YT=    2-year  <CZ2YT=   0.1960  -0.0200   +089bp    -2bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   0.5980  -0.0940   +128bp   -10bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   1.0440  -0.0360   +152bp    -4bps
 =RR     10-year   =RR>                             s  
         Poland                                               
 PL2YT=    2-year  <PL2YT=   0.0630  -0.0340   +075bp    -4bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   0.6900  -0.0150   +137bp    -2bps
 RR                RR>                              s  
 PL10YT            <PL10YT   1.3670   0.0000   +184bp    +0bps
 =RR     10-year   =RR>                             s  
                                                              
                   FRA                                        
                            3x6      6x9      9x12     3M
                                                       interba
                                                       nk
         Czech     <CZKFRA     0.36     0.36     0.39     0.34
         Rep       ><PRIBO                             
                   R=>                                 
         Hungary   <HUFFRA     0.79     0.84     0.89     0.63
                   ><BUBOR                             
                   =>                                  
         Poland    <PLNFRA     0.23     0.20     0.20     0.23
                   ><WIBOR                             
                   =>                                  
         Note: FRA quotes                                     
         are for ask                                   
         prices                                        
         ********************************************         
         ******************                            
    

 (Reporting by Alan Charlish in Warsaw and Jason Hovet in
Prague, editing by Ed Osmond)
  
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