January 7, 2020 / 10:07 AM / 15 days ago

CEE MARKETS-Polish zloty steady, shrugging off inflation jump

    BUCHAREST, Jan 7 (Reuters) - The Polish zloty was steady
against the euro in early trade on Tuesday as analysts saw no
change in the central bank's interest rate policy despite its
highest inflation reading since 2012. 
    Flash data showed Polish consumer price inflation at 3.4% on
the year in December, above market expectations of 2.9%.

    "A strong increase in inflation should be neutral for
monetary policy as price pressure remains mostly driven by
non-core items," Erste Bank said in a research note. "We
continue to see the flat policy rate until the end of 2021."
    Monika Kurtek, chief economist at Bank Pocztowy, said the
inflation level was "certainly disturbing for some MPC (members)
and will trigger a discussion on the current monetary policy".
    "However, interest rate changes should not be expected in
the coming months, as the Council will probably want to wait and
observe the next data."
    At 0935 GMT, the zloty was flat at 4.2355 to the
euro.    
    Elsewhere in the region, the Romanian leu was also
flat ahead of a Wednesday central bank meeting when policymakers
are widely expected to leave rates unchanged. The Hungarian
forint was down 0.3% at 330.4200 to the euro. 
    The Czech crown was down 0.1% at 25.2500 per euro,
after briefly touching its strongest level since Feb. 2018 in
late trading on Monday. Analysts said the crown's April 2018
high of 25.400 would continue to act as a resistance level. 
    Stocks mostly rebounded across the region and were firmer,
led by Hungary's blue chip index, which was 0.7% higher
on the day. 
    
           CEE       SNAPSHO   AT                      
           MARKETS   T        1057              
                              CET               
                     CURRENC                           
                     IES                        
                     Latest   Previou  Daily    Change
                              s                 
                     bid      close    change   in 2020
 Czech     <EURCZK=  25.2490  25.2400   -0.04%   +0.72%
 crown     >                                    
 Hungary   <EURHUF=  330.800  329.590   -0.37%   +0.10%
 forint    >               0        0           
 Polish    <EURPLN=   4.2339   4.2342   +0.01%   +0.53%
 zloty     >                                    
 Romanian  <EURRON=   4.7745   4.7755   +0.02%   +0.29%
 leu       >                                    
 Croatian  <EURHRK=   7.4475   7.4642   +0.22%   -0.03%
 kuna      >                                    
 Serbian   <EURRSD=  117.410  117.510   +0.09%   +0.14%
 dinar     >               0        0           
 Note:     calculated from             1800            
 daily                                 CET      
 change                                         
                                                       
                     Latest   Previou  Daily    Change
                              s                 
                              close    change   in 2020
 Prague              1119.30  1118.43   +0.08%   +0.33%
                                   00           
 Budapest            44945.7  44658.7   +0.64%   -2.47%
                           0        6           
 Warsaw              2165.35  2173.97   -0.40%   +0.71%
 Buchares            9876.65  9865.83   +0.11%   -1.01%
 t                                              
 Ljubljan  <.SBITOP   933.80   932.92   +0.09%   +0.86%
 a         >                                    
 Zagreb              2035.10  2036.69   -0.08%   +0.88%
 Belgrade  <.BELEX1   801.69   801.69   +0.00%   +0.00%
           5>                                   
 Sofia                568.50   570.65   -0.38%   +0.06%
                     BONDS                             
                     Yield    Yield    Spread   Daily
                     (bid)    change   vs Bund  change
                                                in
 Czech                                          spread
 Republic                                       
   2-year  <CZ2YT=R   1.7130   0.0310   +233bp    +3bps
           R>                                s  
   5-year  <CZ5YT=R   1.4480   0.0660   +200bp    +7bps
           R>                                s  
           <CZ10YT=   1.6010   0.0350   +188bp    +2bps
 10-year   RR>                               s  
 Poland                                                
   2-year  <PL2YT=R   1.5300   0.0490   +215bp    +5bps
           R>                                s  
   5-year  <PL5YT=R   1.8720   0.0650   +242bp    +7bps
           R>                                s  
           <PL10YT=   2.1410   0.0670   +242bp    +6bps
 10-year   RR>                               s  
           FORWARD   RATE     AGREEME                  
                              NT                
                     3x6      6x9      9x12     3M
                                                interba
                                                nk
 Czech                  2.25     2.24     2.19     2.17
 Rep       <PRIBOR=                             
           >                                    
 Hungary                0.27     0.34     0.45     0.00
                                                
 Poland                 1.74     1.73     1.72     1.71
                                                
 Note:     are for ask                                 
 FRA       prices                               
 quotes                                         
 *********************************************         
 *****************                              
 
 (Reporting by Luiza Ilie in Bucharest, Jason Hovet in Prague
and Alan Charlish in Warsaw; Editing by Kevin Liffey)
  
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