June 18, 2020 / 10:22 AM / 25 days ago

CEE MARKETS-Zloty gains after minister says currency too weak

    PRAGUE, June 18 (Reuters) - Poland's zloty firmed on
Thursday after the country's finance minister said the exchange
rate looked too weak, countering indications of concern from the
central bank this week about the currency's strength.
    Other central European currencies and stocks mostly
struggled to find a direction, with global markets drifting on
growing fears of a second wave of the coronavirus pandemic as
U.S. cases rose.
    The Czech crown eased a touch going into the quiet period
before the central bank's rate setting meeting next week. 
    Recent policymaker comments have doused expectations the
Czech bank may cut the main interest rate again
after reducing it by 200 basis points to 0.25% since March. 
    The Polish central bank, which cut rates to near zero in
May, held off this week but signalled it preferred a weaker
zloty during the coronavirus crisis to support economic
recovery, analysts said.
    The zloty was up 0.2% at 4.454 to the euro by 0955
GMT.
    After the central bank's comments prompted speculation it
could intervene against the zloty, Finance Minister Tadeusz
Koscinski said on Thursday the currency was currently too weak.

    "It may be that (Polish central bank) interventions may not
have to happen against the zloty and it will happen naturally
via the market," analysts at bank CSOB said in a note.
    "If the central bank continues to buy large sums of state
bonds and the number of (coronavirus) infections doesn't
improve, it is tough to imagine zloty appreciation."
    The crown was steady and Hungary's forint
 eased 0.15%.
    Commerzbank said Czech central banker comments leading up to
next week's rate meeting showed a rejection of the bank turning
to unconventional tools if there was no deterioration in the
coronavirus crisis. 
    In Romania, where interest rates are higher compared to its
central European peers, the leu was flat.
    The central bank there said it would continue to ensure
market liquidity while keeping the exchange rate relatively
stable and gradually lowering interest rates without
discouraging domestic savings.
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1155              
                                     CET               
                                                              
                   CURRENC                                    
                   IES                                 
                            Latest   Previou  Daily    Change
                                     s                 
                            bid      close    change   in 2020
 EURCZK  Czech     <EURCZK  26.5990  26.6060   +0.03%   -4.39%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  345.050  344.545   -0.15%   -4.03%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.4535   4.4643   +0.24%   -4.43%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.8385   4.8388   +0.01%   -1.04%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.5440   7.5440   +0.00%   -1.31%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.510  117.580   +0.06%   +0.05%
 =       dinar     =>             0        0           
         Note:     calculated from            1800            
         daily                                CET      
         change                                        
                                                              
                   STOCKS                                     
                            Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in 2020
 .PX     Prague              936.81  933.410   +0.36%  -16.03%
                                           0           
 .BUX    Budapest           37594.3  37767.7   -0.46%  -18.42%
                                  0        2           
 .WIG20  Warsaw    <.WIG20  1798.43  1787.81   +0.59%  -16.36%
                   >                                   
 .BETI   Buchares           8714.20  8695.98   +0.21%  -12.66%
         t                                             
 .SBITO  Ljubljan  <.SBITO   854.23   859.88   -0.66%   -7.74%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  1639.22  1655.81   -1.00%  -18.75%
                   >                                   
 .BELEX  Belgrade  <.BELEX   675.57   675.80   -0.03%  -15.73%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   459.02   459.46   -0.10%  -19.21%
                   >                                   
                                                              
                   BONDS                                      
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
                                                       in
         Czech                                         spread
         Republic                                      
 CZ2YT=    2-year  <CZ2YT=   0.1410  -0.0010   +079bp    -1bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   0.4430   0.0450   +108bp    +4bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   0.9550   0.0600   +138bp    +6bps
 =RR     10-year   =RR>                             s  
         Poland                                               
 PL2YT=    2-year  <PL2YT=   0.2810   0.0040   +093bp    +0bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   0.8800  -0.0200   +151bp    -3bps
 RR                RR>                              s  
 PL10YT            <PL10YT   1.4490  -0.0090   +188bp    -1bps
 =RR     10-year   =RR>                             s  
                                                              
                   FRA                                        
                            3x6      6x9      9x12     3M
                                                       interba
                                                       nk
         Czech     <CZKFRA     0.31     0.35     0.39     0.34
         Rep       ><PRIBO                             
                   R=>                                 
         Hungary   <HUFFRA     0.79     0.73     0.68     0.90
                   ><BUBOR                             
                   =>                                  
         Poland    <PLNFRA     0.24     0.27     0.29     0.27
                   ><WIBOR                             
                   =>                                  
         Note: FRA quotes are for                             
         ask prices                                    
         ********************************************         
         ******************                            
                                                              
    

 (Reporting by Jason Hovet in Prague, Anita Komuves in Budapest
and Alan Charlish in Warsaw; Editing by Kirsten Donovan)
  
 
 
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