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CEE MARKETS-Forint eases on central bank's Nagy move, Polish banks slip
March 6, 2017 / 4:56 PM / 9 months ago

CEE MARKETS-Forint eases on central bank's Nagy move, Polish banks slip

    * Zloty, forint ease, near psychological levels
    * Hungary central banker responsibility cuts cause worry
    * Poland's PKO earnings rise by less than expected

 (Adds further fall of Polish bank stocks)
    By Sandor Peto
    BUDAPEST, March 6 (Reuters) - Hungary's forint eased on
Monday after the central bank cut more of Deputy Governor Marton
Nagy's responsibilities, while Poland's zloty retreated further
against the euro.
    Regional equities were also mostly negative even though the
markets looked much calmer than a week ago when profit-taking
knocked the indices after a global rally.
    The Hungarian central bank said Nagy, who is regarded as the
mastermind of the bank's dovish course built on unorthodox,
liquidity-boosting tools and a funding for growth scheme, would
no longer be in charge of financial stability issues.
    But Nagy, who resigned last week as chairman of the Budapest
Stock Exchange, will keep a monetary policy brief.
    The forint eased 0.3 percent against the euro and
the zloty had shed 0.4 percent by 1603 GMT. 
    "It is an international impact, with the dollar easing
against the euro...and the news on Nagy may have also played a
role as he is liked in markets," a Budapest currency dealer
said.
    A fixed income trader at another bank said they were getting
inquiries from abroad about Nagy and the uncertainty over him
weighed on the forint, which was probably not unwelcome for the
central bank.
    "Monetary policy without Nagy would be probably even more
dovish than now," the trader said.
    Economic figures to be released in the region this week,
including Hungary, are likely to underpin consumption-led growth
and further rise in inflation, Erste group said in a note.
    "In general, we do not think that they will rush to increase
rates this year," it added.
    Central bank policy tightening later could lift the revenues
of commercial banks, further improving the sector's outlook
after a rise in earnings last year.
    Bank stocks have been a key driver of a rally if equities in
the region this year.
    The stocks of Poland's biggest lender, PKO BP fell
2 percent on Monday after it reported a 34 percent annual rise
in its fourth-quarter profits, less than expected, and said it
expected a stabilisation of net interest revenues this year.

    The government said it planned to convert part of the debt
of state coal producer KHW into shares of a merged state coal
firm. The holders of KHW bonds include PKO and BZ WBK bank whose
shares fell 1.7 percent.
    Warsaw's bluechip stock index shed 0.7 percent by 1603 GMT.
    
              CEE        SNAPS   AT  1703          
              MARKETS    HOT    CET           
                         CURRENCIES                
                         Lates  Previ  Daily  Chang
                         t      ous           e
                         bid    close  chang  in
                                       e      2017
 Czech crown             27.02  27.02   +0.0  -0.05
                            00     00     0%      %
 Hungary                 309.8  309.0  -0.26  -0.32
 forint                    100    000      %      %
 Polish                  4.311  4.295  -0.38  2.13%
 zloty                       9      6      %  
 Romanian                4.532  4.533   +0.0  0.05%
 leu                         8      2     1%  
 Croatian                7.410  7.416   +0.0  1.96%
 kuna                        0      6     9%  
 Serbian                 123.6  123.6   +0.0  -0.23
 dinar                     400    900     4%      %
 Note: daily  calculate  previ  close  1800        
 change       d from     ous    at     CET    
                         STOCK                     
                         S                    
                         Lates  Previ  Daily  Chang
                         t      ous           e
                                close  chang  in
                                       e      2017
 Prague                  975.5  974.2   +0.1   +5.8
                             7      3     4%     5%
 Budapest                33157  33193  -0.11   +3.6
                           .94    .81      %     1%
 Warsaw                  2217.  2232.  -0.70   +13.
                            41     98      %    83%
 Bucharest               7923.  7978.  -0.70   +11.
                            39     97      %    83%
 Ljubljana               788.1  793.8  -0.72   +9.8
                             2      3      %     3%
 Zagreb                  2209.  2218.  -0.40   +10.
                            54     38      %    76%
 Belgrade     <.BELEX15  725.8  722.1   +0.5   +1.1
              >              0      9     0%     8%
 Sofia                   615.1  613.0   +0.3   +4.8
                             2      7     3%     9%
                         BONDS                     
                         Yield  Yield  Sprea  Daily
                                       d      
                         (bid)  chang  vs     chang
                                e      Bund   e in
 Czech                                        sprea
 Republic                                     d
   2-year     <CZ2YT=RR  -0.62  0.035   +020   +5bp
              >              6           bps      s
   5-year     <CZ5YT=RR  -0.02  -0.04   +041  -3bps
              >                     2    bps  
   10-year    <CZ10YT=R  0.655  -0.03   +031  -2bps
              R>                    3    bps  
 Poland                                            
   2-year     <PL2YT=RR  2.168  0.003   +299   +2bp
              >                          bps      s
   5-year     <PL5YT=RR  3.025  -0.03   +345  -2bps
              >                     5    bps  
   10-year    <PL10YT=R  3.693  -0.03   +335  -3bps
              R>                    6    bps  
              FORWARD    RATE   AGREEMENT          
                         3x6    6x9    9x12   3M
                                              inter
                                              bank
 Czech Rep            <    0.3   0.33    0.4      0
              PRIBOR=>                        
 Hungary              <  0.315   0.44  0.565   0.23
              BUBOR=>                         
 Poland               <   1.77   1.79   1.86   1.73
              WIBOR=>                         
 Note: FRA    are for                              
 quotes       ask                             
              prices                          
 **************************************************
 ************
 
 (Additional reporting by Radu Marinas in Bucharest and Marcin
Goclowski in Warsaw; Editing by Alexander Smith)
  
 
 

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