Edition:
United Kingdom

Alan Charlish

Rule of law concerns may hurt growth in Poland, Hungary, says EBRD

05 Dec 2019

WARSAW Central European countries that flout the rule of law risk hurting innovation and growth by losing out in the race to attract foreign investors, the European Bank for Reconstruction and Development's (EBRD) chief economist said on Thursday.

Rule of law concerns may hurt growth in Poland, Hungary, says EBRD

05 Dec 2019

WARSAW, Dec 5 Central European countries that flout the rule of law risk hurting innovation and growth by losing out in the race to attract foreign investors, the European Bank for Reconstruction and Development's (EBRD) chief economist said on Thursday.

Poland sees bigger state role in economy, more court reforms

19 Nov 2019

WARSAW Poland's prime minister set out plans on Tuesday to strengthen the state's role in the economy and deepen an overhaul of the justice system that has put Warsaw on a collision course with its European Union partners.

Polish central banker Ancyparowicz expects stable rates until 2022

15 Nov 2019

WARSAW, Nov 15 Polish interest rates are likely to remain on hold until 2022, but if data pointed to a serious slowdown a rate cut would be a possibility, central banker Grazyna Ancyparowicz told Reuters.

CEE MARKETS-Currencies fall as Trump's speech dampens trade deal hopes

13 Nov 2019

By Alan Charlish WARSAW, Nov 13 Central Europe's main currencies continued to soften on Wednesday, as a better-than-expected reading on German investor sentiment was offset by U.S. President Donald Trump's speech that dashed hopes of a concrete trade deal with China. Trump on Tuesday said an initial trade deal with China could happen "soon", but offered no new details on negotiations despite rumours before the speech that he might announce a venue and date for signing the deal. "Donald Trump poured a bucket of cold water on investors' heads," PKO BP said in a note. At 0949 GMT, the Polish zloty was down 0.13% against the euro at 4.2835. The Czech crown was down 0.16% at 25.57 while the Hungarian forint fell 0.09% to 334.9. There was more positive news from Germany, a key trading partner for central European economies, as a ZEW survey showed on Tuesday that the mood among German investors improved more than expected in November. ZEW said its monthly survey showed economic sentiment among investors jumped to -2.1 from -22.8 in October. In Poland, bond yields fell across the curve in line with euro zone peers as Trump's remarks cast a shadow over recent optimism. Polish 2-year yields fell 2 basis points to 1.383% while 10-year yields fell 6 basis points to 2.097%. "In the case of long-term yields, I mean the 10-year benchmark, I would expect further declines in yields below 2.10% over the short term," said Adam Antoniak, senior economist at Pekao. The Czech Republic auctioned 2027 and 2033 bonds on Wednesday. "Relatively shallow amount offered showing the finance ministry's 2019 financing needs have been mostly covered," Komercni Banka rates trader Dalimil Vyskovsky said in a client note. "As was the case in a slightly weaker-than-expected auction two weeks ago, they are unlikely to sell anything that would be too cheap compared to the market or their own thinking." Yields on the bonds were bid up 1-5 basis points in early trading on Wednesday. Benchmark Czech 10-year yields fell one basis point to 1.564%. Stocks fell across the region, with Budapest's main index shedding 0.53% and Warsaw's blue-chip WIG 20 index falling 0.84%. Polish energy group PGE fell 4.9% after its guidance for weaker EBITDA in 2020 worried investors. CEE SNAPSHOT AT MARKETS 1049 CET CURRENCI ES Latest Previous Daily Change bid close change in 2019 Czech 25.5700 25.5300 -0.16% +0.54% crown Hungary 334.9000 334.6000 -0.09% -4.13% forint Polish 4.2835 4.2780 -0.13% +0.14% zloty Romanian 4.7645 4.7619 -0.05% -2.32% leu Croatian 7.4500 7.4475 -0.03% -0.54% kuna Serbian 117.2900 117.4450 +0.13% +0.86% dinar Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2019 Prague 1081.56 1084.110 -0.24% +9.63% 0 Budapest 43260.15 43492.33 -0.53% +10.53% Warsaw 2229.98 2248.81 -0.84% -2.05% Bucharest 9691.27 9692.81 -0.02% +31.25% Ljubljana 877.17 875.84 +0.15% +9.07% Zagreb 1971.69 1971.08 +0.03% +12.74% Belgrade <.BELEX15 766.06 762.55 +0.46% +0.57% > Sofia 558.04 558.24 -0.04% -6.13% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=RR 1.4330 0.0600 +207bps +7bps > 5-year <CZ5YT=RR 1.2830 0.0340 +185bps +6bps > 10-year <CZ10YT=R 1.5640 -0.0110 +185bps +3bps R> Poland 2-year <PL2YT=RR 1.3830 -0.0200 +202bps -1bps > 5-year <PL5YT=RR 1.7880 -0.0420 +235bps -2bps > 10-year <PL10YT=R 2.0970 -0.0590 +239bps -1bps R> FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech Rep < 2.26 2.25 2.17 2.18 PRIBOR=> Hungary < 0.27 0.30 0.34 0.19 BUBOR=> Poland < 1.73 1.71 1.67 1.71 WIBOR=> Note: FRA are for ask prices quotes ************************************************** ************ (Reporting by Alan Charlish in Warsaw and Jason Hovet in Prague; Editing by Rashmi Aich)

Coal-reliant Poland's e-car push clouded by EU emissions row

08 Nov 2019

WARSAW/PRAGUE Poland is betting on electric batteries to turbocharge its economy, but its dependency on coal could challenge its strategy as the EU seeks to champion European manufacturers that promote clean energy.

CORRECTED-CEE MARKETS-Eyes on rate decisions as strong dollar pressures currencies

06 Nov 2019

(Corrects paragraph 8 to read last Wednesday, not Friday) By Alan Charlish WARSAW, Nov 6 Central European currencies weakened slightly on Wednesday, penalised by a stronger dollar on a day when two regional central banks were expected to announce stable rates. Central banks in Poland and Romania announce rates decisions on Wednesday, with analysts polled by Reuters expecting them to hold the cost of borrowing steady at 1.5% and 2.5% respectively. Faced with the conflicting currents of monetary easing in the West and inflationary pressures at home, the region's central bankers have on the whole opted for a wait-and-see policy, but Poland's monetary policy council (MPC) has seen both hikes and cuts proposed in recent months. "Neither cuts nor hikes are likely to get majority support, so interest rates are expected to remain unchanged," Santander Bank Polska analysts said in a note. At 1029 GMT the Polish zloty was bid 0.15% lower against the euro at 4.269. The Hungarian forint shed 0.11% to 331.4 while the Czech crown fell 0.04% to 25.51 and the Romanian leu dropped 0.15% to 4.76. "It is just a repricing ...the Fed decided to pause the rate cuts, the market reversed their expectation of further Fed easing so that pushed the dollar a bit stronger," said Peter Virovacz, senior economist for Hungary at ING. "Previously we've seen the same movements when the dollar started to strengthen versus the euro." The U.S Federal Reserve cut its target for the overnight bank-to-bank lending rate for the third time this year last Wednesday. However, markets reduced bets the Fed would soon cut rates again after a stronger-than-expected jobs report and comments from White House economic adviser Larry Kudlow that no discussions had taken place about ousting U.S. Federal Reserve Chairman Jerome Powell. In Hungary, calendar-adjusted retail sales rose by an annual 5.8% in September. "The latest figures again reinforce that strong consumer consumption has continued to support economic growth," Erste Group analyst Orsolya Nyeste said in a note. Czech working day adjusted industrial output fell by a lower-than-expected 0.6% year-on-year in September, pulled down by lower machine and electronics manufacturing. In Poland, 2-year bond yields fell just under 1 basis point to 1.397% while 10-year yields rose 1 basis point to 2.021%. "On Wednesday, the MPC meeting will be the main event for bond valuations," PKO BP analysts said in a note. "Although interest rates should remain unchanged, the likely easing of monetary policy stance by the Council would support the short end of the curve." Czech 10-year yields were down 1.4 basis points at 1.419%. Stocks were mixed, with Poland's WIG 20 index falling 0.47% and Budapest's main index shedding 0.13%, while Prague's PX index rose 0.13%. The top performer in Prague was Moneta Money Bank , which rose 2.5% after its third quarter net profit beat estimates and it raised its outlook for 2019. CEE SNAPSHOT AT MARKETS 1118 CET CURRENCI ES Latest Previous Daily Change bid close change in 2019 Czech 25.5150 25.5220 +0.03% +0.75% crown Hungary 331.3500 331.3000 -0.02% -3.10% forint Polish 4.2680 4.2654 -0.06% +0.51% zloty Romanian 4.7625 4.7545 -0.17% -2.28% leu Croatian 7.4375 7.4400 +0.03% -0.37% kuna Serbian 117.2900 117.4000 +0.09% +0.86% dinar Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2019 Prague 1078.42 1077.010 +0.13% +9.31% 0 Budapest 43179.55 43236.80 -0.13% +10.32% Warsaw 2261.78 2272.45 -0.47% -0.65% Bucharest 9708.28 9678.05 +0.31% +31.48% Ljubljana 862.29 858.97 +0.39% +7.22% Zagreb 1978.29 1978.69 -0.02% +13.12% Belgrade <.BELEX15 749.04 751.45 -0.32% -1.66% > Sofia 555.21 553.06 +0.39% -6.60% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=RR 1.2700 0.0530 +190bps +5bps > 5-year <CZ5YT=RR 1.0990 0.0240 +169bps +1bps > 10-year <CZ10YT=R 1.4190 -0.0140 +173bps -3bps R> Poland 2-year <PL2YT=RR 1.3970 -0.0080 +203bps -1bps > 5-year <PL5YT=RR 1.7560 0.0000 +235bps -1bps > 10-year <PL10YT=R 2.0210 0.0100 +233bps +0bps R> FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech Rep < 2.23 2.22 2.15 2.18 PRIBOR=> Hungary < 0.25 0.28 0.35 0.19 BUBOR=> Poland < 1.72 1.69 1.66 1.71 WIBOR=> Note: FRA are for ask prices quotes ************************************************** ************ (Reporting by Alan Charlish in Warsaw and Radu-Sorin Marinas in Bucharest; Editing by Andrew Cawthorne)

Polish central banker Zubelewicz criticises low interest rates

24 Oct 2019

WARSAW, Oct 24 Poland's record low interest rates are artificially inflating house prices, encouraging people to get into debt and causing higher inflation, central banker Kamil Zubelewicz told Reuters.

CEE MARKETS-Currencies firm slightly as all eyes on Brexit vote

18 Oct 2019

By Alan Charlish and Anna Wlodarczak-Semczuk WARSAW, Oct 18 Central Europe's main currencies mostly firmed slightly on Friday, with a sentiment boost from a newly-agreed Brexit deal offsetting worries about the global economy as China posted weaker-than expected growth in the third quarter. The twin sagas of Brexit and the trade war between the United States and China have shaped risk sentiment in global financial markets this year, with emerging market assets particularly sensitive to developments. Markets got a boost on Thursday when EU leaders unanimously backed the new Brexit deal, but British Prime Minister Boris Johnson faces a battle to secure parliament's backing on Saturday if he still hopes to take Britain out of the EU on Oct. 31. In China, third quarter gross domestic product rose just 6.0% year-on-year, as the trade war with the U.S. hit factory production. At 0848 GMT the Polish zloty was flat against the euro at 4.2825. The Czech crown was 0.14% stronger at 25.668 while the Hungarian forint firmed 0.12% to 330.69. "The market is waiting for the final Brexit news, tomorrow's vote in parliament in London... It's a major, major risk event tomorrow," said a Warsaw-based currency trader. "The zloty is quite strong... I think the scope to move lower in euro/zloty is limited, we've reached the bottom of the range." In Poland, September industrial output and PPI both beat analysts' estimates, rising 5.6% and 0.9% year on year respectively. "0.9% is not a level that would cause anxiety, the market reaction seems neutral to me, because the situation on the markets is determined by global factors," said Grzegorz Maliszewski, Chief economist at Bank Millennium. Czech 10-year yields rose 2.8 basis points to 1.453%, while Polish 10-year paper traded at 2.025%, up almost 1 basis point. Central European bonds often track western European peers, and eurozone bond yields inched up ahead of Saturday's Brexit vote. Stocks were mixed with Prague's PX index rising 0.64% while Warsaw's WIG 20 fell 0.56%. Polish mining company JSW was the worst performer on the WIG 20, falling 3.5% after it reported a drop in coal sales in the third quarter despite an increase in production. CEE SNAPSHOT AT MARKETS 1048 CET CURRENCI ES Latest Previous Daily Change bid close change in 2019 Czech 25.6700 25.6730 +0.01% +0.14% crown Hungary 330.6900 331.1000 +0.12% -2.90% forint Polish 4.2825 4.2824 -0.00% +0.17% zloty Romanian 4.7550 4.7538 -0.03% -2.12% leu Croatian 7.4405 7.4423 +0.02% -0.41% kuna Serbian 117.5000 117.6100 +0.09% +0.68% dinar Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2019 Prague 1040.87 1034.300 +0.64% +5.50% 0 Budapest 40627.51 40717.17 -0.22% +3.80% Warsaw 2161.52 2173.75 -0.56% -5.06% Bucharest 9585.69 9558.18 +0.29% +29.82% Ljubljana 873.25 871.28 +0.23% +8.58% Zagreb 2016.63 2011.29 +0.27% +15.31% Belgrade <.BELEX15 744.53 747.83 -0.44% -2.25% > Sofia 565.41 563.67 +0.31% -4.89% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=RR 1.3980 0.0680 +205bps +6bps > 5-year <CZ5YT=RR 1.1060 -0.0470 +174bps -6bps > 10-year <CZ10YT=R 1.4530 0.0280 +184bps +1bps R> Poland 2-year <PL2YT=RR 1.5010 -0.0090 +215bps -1bps > 5-year <PL5YT=RR 1.7870 0.0130 +242bps +0bps > 10-year <PL10YT=R 2.0250 0.0090 +241bps -1bps R> FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech Rep < 2.31 2.32 2.25 2.18 PRIBOR=> Hungary < 0.27 0.31 0.31 0.21 BUBOR=> Poland < 1.73 1.70 1.68 1.71 WIBOR=> Note: FRA are for ask prices quotes ************************************************** ************ (Reporting by Alan Charlish and Anna Wlodarczak-Semczuk in Warsaw, Radu-Sorin Marinas in Bucharest and Krisztina Than in Budapest; Editing by Toby Chopra)

Brexit deal at hand in Brussels, Johnson struggles to win support at home

17 Oct 2019

BRUSSELS/WARSAW Britain and the European Union were on the verge of a last-minute Brexit deal on Wednesday but Prime Minister Boris Johnson still has work to do at home to ensure his government and factious parliament approve the plan. | Video

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