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Radu-Sorin Marinas

CEE MARKETS-Inflation buoys crown, stocks up on US-China deal

13 Jan 2020

By Radu-Sorin Marinas BUCHAREST, Jan 13 Central European shares edged up, mirroring a global mode as investors awaited the signing of a Sino-U.S. trade deal later this week, while the Czech crown got a boost from a pick-up in inflation. By 0950 GMT the crown firmed 0.1% to 25.24 to the euro, holding near a 23-month high hit at the start of this year. Other regional currencies were mostly flat, while the forint edged 0.3% down on the day. Czech inflation accelerated in December though most analysts expected the bank would continue to hold steady on rates despite ongoing debate over a hike, which was voted down at the last three meetings. Inflation was outside the upper end of the central bank's tolerance range around its 2% target for a second straight month. "Whether the central bank will further raise rates will mainly depend on economic development abroad," ING economist Jakub Seidler said. Markets have priced out chances of a rate cut over the next year period in recent weeks. Some analysts still see chances a hike could come some time this year if the global outlook improves. On stock markets, Bucharest's blue chip BETI led regional gains with a 0.5% rise, close to a year high of 10,012, with heavyweight investment fund Fondul Proprietatea trading 1.7% up on the day. Poland's market came second with 0.3%. "Fondul's (share) buyback programme unveiled last week continues to prop up the stock, and there's also the background of a long awaited deal between China and the United States that should happen this week," said a Bucharest-based trader. CEE MARKETS SNAPSHOT AT 1100 CET CURRENCIE S Latest Previous Daily Change bid close change in 2020 Czech 25.2490 25.2640 +0.06% +0.72% crown Hungary 335.0000 333.8000 -0.36% -1.15% forint Polish 4.2379 4.2358 -0.05% +0.44% zloty Romanian 4.7800 4.7791 -0.02% +0.17% leu Croatian 7.4430 7.4425 -0.01% +0.03% kuna Serbian 117.5400 117.5800 +0.03% +0.03% dinar Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2020 Prague 1137.07 1133.670 +0.30% +1.92% 0 Budapest 45553.83 45364.14 +0.42% -1.15% Warsaw 2177.92 2167.91 +0.46% +1.29% Buchares 9998.96 9952.83 +0.46% +0.22% t Ljubljan 972.82 965.30 +0.78% +5.07% a Zagreb 2037.89 2036.45 +0.07% +1.01% Belgrade 795.96 805.40 -1.17% -0.71% Sofia 578.54 579.24 -0.12% +1.83% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year 1.7100 0.0200 +230bps +1bps 5-year 1.4430 -0.0340 +194bps -4bps 1.6590 0.0210 +188bps +1bps 10-year Poland 2-year 1.5660 0.0330 +216bps +2bps 5-year 1.9960 0.0490 +249bps +4bps 2.2960 0.0300 +251bps +2bps 10-year FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interbank Czech <PR 2.26 2.27 2.32 2.17 Rep IBOR=> Hungary <BU 0.26 0.35 0.43 0.16 BOR=> Poland <WI 1.76 1.77 1.80 1.71 BOR=> Note: are for ask prices FRA quotes **************************************************** ********** (Additional reporting by Jason Hovet in Prague; Editing by Andrew Cawthorne)

CEE MARKETS-FX, stocks fall as threat of Middle East conflict grows

03 Jan 2020

By Radu-Sorin Marinas BUCHAREST, Jan 3 Central European currencies fell on Friday and stocks gave up some of the previous day's gains, after a U.S. air strike killed a top Iranian military official. The region started the new year strong on Thursday, with Budapest's stock index reaching a record high and the Czech crown climbing to its highest against the euro since April 2018. But currencies and shares fell back as world stocks slipped and oil prices soared. Markets grew nervous after the Pentagon confirmed the air strike, saying Iran's Major-General Qassem Soleimani was developing plans to attack Americans in the Middle East. "Friday morning trade on the FX market is bringing an increase in risk-off sentiment due to geopolitical risk increasing again," said Konrad Ryczko, an analyst at DM BOS. By 1000 GMT, the Polish zloty was leading regional losses, down 0.3% to 4.255 against the euro, followed by the Hungarian forint with a 0.2% decline to 329.5. "The forint firmed past a key level yesterday. The currency firmed past 330 versus the euro ... the next important level is at 327.50 which could be reached next week based on the current picture," brokerage Equilor said. The Romanian leu and the Czech crown nudged higher. The crown has started the year at its strongest level against the euro since April 2018, touching 25.310 on Friday. Minutes from the Czech central bank's last policy meeting on Dec. 18, released on Friday, showed rates were likely to remain stable, some analysts believe. "We rate the overall message of the minutes as less hawkish than Governor Jiri Rusnok's press conference after the bank meeting," Komercni Banka analysts said. Regional stocks, which started 2020 on a positive note, with the Budapest stock exchange reaching a record high the previous day, weakened in early trade. Warsaw's WIG20 fell 1.25% on the day and Budapest's main index eased 0.5% CEE SNAPSHOT AT MARKETS 1112 CET CURRENCI ES Latest Previou Daily Change s bid close change in 2020 Czech 25.3120 25.3370 +0.10% +0.47% crown Hungary 329.5000 329.000 -0.15% +0.50% forint 0 Polish 4.2549 4.2440 -0.26% +0.04% zloty Romanian 4.7810 4.7816 +0.01% +0.15% leu Croatian 7.4450 7.4430 -0.03% +0.01% kuna Serbian 117.6000 117.570 -0.03% -0.03% dinar 0 Note: calculated from 1800 daily CET change Latest Previou Daily Change s close change in 2020 Prague 1123.62 1123.91 -0.03% +0.72% 00 Budapest 46024.67 46230.2 -0.44% -0.13% 2 Warsaw 2173.59 2200.10 -1.20% +1.09% Buchares 9946.63 9977.30 -0.31% -0.31% t Ljubljan 925.90 925.86 +0.00% +0.00% a Zagreb 2033.01 2029.25 +0.19% +0.77% Belgrade <.BELEX15 801.69 801.69 +0.00% +0.00% > Sofia 566.69 568.25 -0.27% -0.26% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=RR 1.7540 0.0080 +239bp +3bps > s 5-year <CZ5YT=RR 1.4850 -0.0580 +204bp -1bps > s <CZ10YT=R 1.6560 -0.0040 +194bp +5bps 10-year R> s Poland 2-year <PL2YT=RR 1.4790 -0.0160 +211bp +1bps > s 5-year <PL5YT=RR 1.7900 -0.0250 +235bp +3bps > s <PL10YT=R 2.0680 -0.0580 +235bp +0bps 10-year R> s FORWARD RATE AGREEME NT 3x6 6x9 9x12 3M interba nk Czech < 2.27 2.27 2.23 2.18 Rep PRIBOR=> Hungary < 0.24 0.30 0.41 0.16 BUBOR=> Poland < 1.72 1.69 1.68 1.71 WIBOR=> Note: are for ask prices FRA quotes *********************************************** *************** (Reporting by Krisztina Than in Budapest, Jason Hovet in Prague and Alan Charlish in Warsaw; editing by Larry King)

CEE MARKETS-CEE FX edges up, details of US-China agreement eyed

16 Dec 2019

By Radu-Sorin Marinas BUCHAREST, Dec 16 Central European currencies edged up on Monday, with markets awaiting details of trade agreement between the United States and China. The United States will reduce some tariffs in exchange for what U.S. officials said would be a jump in Chinese purchases of American farm products and other goods. But fine details of the deal, which has not been signed yet, are still awaited. By 0910 GMT, the Polish zloty had edged up 0.2% to 4.2660 to the euro. The Hungarian forint continued to gain, past the resistance level of 330. Late on Friday, two central bank sources said Hungary's central bank plans to extend a 300 billion forint ($989 million) programme to buy corporate bonds it began in July, with a decision possibly as soon as Tuesday. The Romanian leu was flat and the Czech crown lingered at around 25.4900 against the euro, as November producer price data provided reason not to raise interest rates. "Low production prices remain an argument against further raising of interest rates by the central bank. Producer prices usually don't give the Czech crown market any significant impulse and today's data are no exception," said Michal Brozka of Komercni Banka/Societe Generale. The Czech National Bank holds its monetary policy meeting on Wednesday. Elsewhere, Romanian debt managers plan to sell 500 million lei ($115.45 million) worth of 2031 treasury bonds. "Romanian government bonds are a volatile market these days and we could have a pleasant surprise here," ING analysts said. "Yield-wise, printing below 5.00% will be a challenge." Among regional stock markets, Prague and Budapest led gains with 0.3% rise. Hungary's OTP traded up 0.13% on the day at 15,620. On Friday, it said it had completed acquisition of a 99.73% stake in Slovenian SKB Banka from Societe Generale . CURRENCIES Latest Previous Daily Change bid close change in 2019 Czech 25.4890 25.4950 +0.02% +0.86% crown Hungary 329.3000 329.4800 +0.05% -2.49% forint Polish 4.2696 4.2687 -0.02% +0.47% zloty Romanian 4.7780 4.7790 +0.02% -2.60% leu Croatian 7.4380 7.4395 +0.02% -0.38% kuna Serbian 117.3900 117.5000 +0.09% +0.78% dinar Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2019 Prague 1096.46 1093.410 +0.28% +11.14% 0 Budapest 45897.25 45760.15 +0.30% +17.27% Warsaw 2110.63 2106.51 +0.20% -7.29% Buchares 9900.90 9880.42 +0.21% +34.09% t Ljubljan 921.71 925.19 -0.38% +14.60% a Zagreb 2000.76 1998.24 +0.13% +14.41% Belgrade <.BELEX15 774.56 776.28 -0.22% +1.69% > Sofia 543.84 543.92 -0.01% -8.52% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=RR 1.5460 -0.0090 +217bps -1bps > 5-year <CZ5YT=RR 1.2770 -0.0140 +182bps -2bps > <CZ10YT=R 1.5320 -0.0300 +183bps -3bps 10-year R> Poland 2-year <PL2YT=RR 1.4040 0.0100 +203bps +1bps > 5-year <PL5YT=RR 1.7810 0.0120 +232bps +1bps > <PL10YT=R 2.0180 -0.0110 +231bps -1bps 10-year R> FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech < 2.25 2.24 2.19 2.18 Rep PRIBOR=> Hungary < 0.25 0.28 0.33 0.16 BUBOR=> Poland < 1.71 1.68 1.65 1.70 WIBOR=> Note: are for ask prices FRA quotes **************************************************** ********** (Reporting by Robert Muller in Prague, editing by Larry King)

CEE MARKETS-CEE FX slides marginally, stocks down on fresh U.S. trade woes

03 Dec 2019

By Radu-Sorin Marinas BUCHAREST, Dec 3 Central European currencies mostly slid marginally in thin trade on Tuesday while stocks eased mirroring emerging assets with investors wary of fallout from a new U.S. trade conflict with Latin American export heavyweights. As trade frictions with China already roil markets, Washington said it would restore tariffs on metal imports from Brazil and Argentina. In Central Europe, Warsaw's WIG 20 led regional losses, down 0.5% on the day, with Poland's second largest lender, Pekao, falling 1.7% to 98.06 zloty by 1000 GMT. Acting Pekao CEO Marek Lusztyn told Polish business daily Parkiet on Tuesday the bank will continue with its outlined strategy after the unexpected resignation of former CEO Michal Krupinski on Friday. Budapest's market eased 0.4% on the day, followed by Prague down 0.3% and Bucharest 0.1%. Players said all eyes will be on this week's monetary policy council in Poland, seen keeping interest rates unchanged. "The assumption about interest rate stabilization (as in minutes) will probably be repeated," PKO BP analysts said in a note. "Despite inflation above the NBP target, the market is pricing in interest rate cuts over the next two years, which is influenced by the actions of major central banks as well as the slowdown in the global economy, with recent GDP data also showing signs of a slowdown in Poland." By 1010 GMT, the Polish zloty led losses with a 0.2% fall, followed by the Romanian leu and the Czech crown with 0.1% slide each. The Hungarian forint was flat at 332.2 to the euro. CEE SNAPSHO AT MARKETS T 1100 CET CURRENC IES Latest Previous Daily Change bid close change in 2019 Czech 25.5500 25.5460 -0.02% +0.61% crown Hungary 332.150 332.2000 +0.02% -3.33% forint 0 Polish 4.2881 4.2831 -0.12% +0.03% zloty Romanian 4.7780 4.7760 -0.04% -2.60% leu Croatian 7.4347 7.4375 +0.04% -0.33% kuna Serbian 117.450 117.4900 +0.03% +0.72% dinar 0 Note: calculated from 1800 daily CET change Latest Previous Daily Change close change in 2019 Prague 1080.05 1081.690 -0.15% +9.48% 0 Budapest 43167.2 43370.30 -0.47% +10.29 2 % Warsaw 2115.98 2122.30 -0.30% -7.06% Bucharest 9902.09 9903.07 -0.01% +34.11 % Ljubljana 898.67 898.96 -0.03% +11.74 % Zagreb 2003.45 2002.18 +0.06% +14.56 % Belgrade <.BELEX15 771.92 770.93 +0.13% +1.34% > Sofia 544.05 547.82 -0.69% -8.48% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=RR 1.5250 0.0240 +215bp +3bps > s 5-year <CZ5YT=RR 1.2870 0.0570 +185bp +7bps > s 10-year <CZ10YT=R 1.5000 0.0060 +179bp +1bps R> s Poland 2-year <PL2YT=RR 1.3990 -0.0010 +202bp +1bps > s 5-year <PL5YT=RR 1.7440 -0.0190 +230bp -1bps > s 10-year <PL10YT=R 2.0430 0.0250 +233bp +3bps R> s FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interba nk Czech Rep < 2.24 2.24 2.15 2.18 PRIBOR=> Hungary < 0.27 0.31 0.35 0.17 BUBOR=> Poland < 1.73 1.70 1.64 1.71 WIBOR=> Note: FRA are for ask prices quotes ************************************************ ************** (Reporting by Radu Marinas; Editing by Andrew Cawthorne)

Romania's Petrom ready to develop Black Sea gas field once government lifts barriers

02 Dec 2019

BUCHAREST Romania's OMV Petrom is ready to press on with a multi-billion euro investment in the giant Black Sea gas project it holds with ExxonMobil once Bucharest's new government lifts regulatory barriers to doing so, it said on Monday.

Romania's Petrom ready to develop Black Sea gas field once government lifts barriers

02 Dec 2019

BUCHAREST, Dec 2 Romania's OMV Petrom is ready to press on with a multi-billion euro investment in the giant Black Sea gas project it holds with ExxonMobil once Bucharest's new government lifts regulatory barriers to doing so, it said on Monday.

Romania's Iohannis wins second presidential term with rule of law pledge

24 Nov 2019

BUCHAREST Romania's centrist President Klaus Iohannis won a presidential election runoff on Sunday as expected, crushing his socialist challenger with a pledge to resume judicial reforms slowed down by successive Social Democrat (PSD) governments.

CEE MARKETS-Forint softens on cenbank rate stance, stocks down

20 Nov 2019

By Radu-Sorin Marinas BUCHAREST, Nov 20 Hungary's forint traded softer on Wednesday after the central bank kept interest rates unchanged the previous day, ignoring a rise in inflation to near the top of its target range. Central Europe's worst-performing currency with a 3.7% loss versus the euro in 2019, the forint reversed its late-October rally earlier this month, and was again trading within sight of its record lows at 336 per euro hit on Sept. 27. At 1110 GMT, the unit traded at 333.3 to the euro, down 0.2 % on the day. "Combined with the recent weakness of the forint and the MNB's emphasis on data-dependent policy making, we continue to think the MNB (National Bank of Hungary) is unlikely to ease further in the December meeting," Goldman Sachs analysts said. "However, given the MNB's view that risks remain skewed to the downside, it suggests that risks to monetary policy are also skewed towards further easing," they added in a note. Other central European currencies were also softer, with the Polish zloty easing 0.17% and the Romanian leu edging down 0.1%. The Czech crown was up 0.16%, with a Prague-based dealer seeing lower liquidity as helping gains as the unit settles into a range between 25.500-25.600, with players waiting for further clues on interest rates. The Czech central bank is rare in Europe in still debating whether policy tightening is needed to fight domestic inflationary pressures. Most analysts expect rate stability through 2020. Regional stocks mostly fell, mirroring a general mode in emerging stocks as tensions flared again between Washington and Beijing, adding uncertainty over whether the two sides can end a trade dispute that is seen as a key risk to global economic growth. Warsaw led losses with a 1.1% fall, followed by Prague and Budapest with 0.4% and 0.1% respectively. CEE SNAPSHO AT 1210 MARKETS T CET CURRENC IES Latest Previous Daily Change bid close change in 2019 Czech <EURCZK= 25.5300 25.5750 +0.18% +0.69% crown > Hungary <EURHUF= 333.180 332.9300 -0.08% -3.63% forint > 0 Polish <EURPLN= 4.2945 4.2867 -0.18% -0.11% zloty > Romanian <EURRON= 4.7780 4.7750 -0.06% -2.60% leu > Croatian <EURHRK= 7.4420 7.4420 +0.00% -0.43% kuna > Serbian <EURRSD= 117.390 117.4900 +0.09% +0.78% dinar > 0 Note: calculated from 1800 daily CET change Latest Previous Daily Change close change in 2019 Prague 1076.56 1079.7300 -0.29% +9.12% Budapest 43597.7 43618.78 -0.05% +11.39% 4 Warsaw 2179.22 2207.25 -1.27% -4.28% Bucharest 9713.89 9706.24 +0.08% +31.56% Ljubljana <.SBITOP 884.78 886.48 -0.19% +10.01% > Zagreb 1997.60 1994.41 +0.16% +14.23% Belgrade <.BELEX1 764.68 766.24 -0.20% +0.39% 5> Sofia 553.83 554.40 -0.10% -6.83% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=R 1.4140 0.0120 +205bp +2bps R> s 5-year <CZ5YT=R 1.2970 0.0530 +191bp +7bps R> s 10-year <CZ10YT= 1.4770 -0.0260 +185bp +1bps RR> s Poland 2-year <PL2YT=R 1.4000 -0.0160 +204bp -1bps R> s 5-year <PL5YT=R 1.7930 -0.0380 +241bp -2bps R> s 10-year <PL10YT= 2.0640 -0.0310 +244bp +0bps RR> s FORWARD RATE AGREEMENT 3x6 6x9 9x12 3M interbank Czech Rep 2.25 2.25 2.18 2.18 <PRIBOR= > Hungary 0.24 0.30 0.34 0.19 Poland 1.73 1.70 1.67 1.71 Note: FRA are for ask quotes prices ************************************************ ************** (Reporting by Jason Hovet in Prague; Editing by Alex Richardson)

Incumbent Iohannis wins Romania's presidential vote, will face runoff

10 Nov 2019

BUCHAREST Romania's centrist President Klaus Iohannis, who has earned praise in the West for his anti-graft stance, won the first round of a presidential ballot on Sunday and will face former premier Viorica Dancila in a Nov. 24 runoff, exit polls showed.

CEE MARKETS-FX, leu edge up as Romania gets new centrist government

05 Nov 2019

By Radu-Sorin Marinas BUCHAREST, Nov 5 Central European currencies edged up on Tuesday, with the leu helped by a vote of confidence in Romania's new centrist government which wants to undo fiscal and judicial measures introduced by a former socialist cabinet. Prime Minister Ludovic Orban's minority cabinet will be in place until a parliamentary election in late 2020, but analysts expect it to struggle to win support from among the fragmented opposition to secure majorities for each bill. But the new cabinet will improve prospects for filling a policymaking vacuum in the European Union. The new Commission team had been due to take over on Nov. 1, but Bucharest's tug-of-war prevented it from nominating a commissioner, a delay that risked pushing the start date into December. Romania holds a presidential, two-round election starting on Sunday, with incumbent Klaus Iohannis, Orban's key political ally, seen winning re-election. "We continue to view this (leu) stability as being mostly related to the electoral context and look for an upward correction towards the end of 2019/early 2020," ING bank said. By 1000 GMT, the leu was 0.1% up at 4.7520 to the euro. It has fallen 2.1% so far this year - making it central and eastern Europe's second worst-performer - as widening deficits and delayed policymaking took their toll. The zloty, which has risen to a three-month high in recent weeks, was flat on the day at 4.2658. The Polish central bank is one of three in the region holding an interest rate meeting this week although markets expect rates to stay on hold when a decision comes on Wednesday. The Czech crown and the Hungarian forint each rose 0.1% to trade at 25.5120 and 329.18 respectively. The Czech central bank, which is one of the few banks in Europe still debating whether to raise rates even as the global mood turns to easing policy amid global trade tensions, meets on Thursday and is also likely to stay on hold. Romania is also seen holding rates at 2.50% on Wednesday, Among the region's stocks, Bucharest's blue chip index was flat, while Budapest eased 0.2%. Prague and Warsaw each rose 0.2%. CEE MARKETS SNAPSHO AT T 1135 CET CURRENC IES Latest Previous Daily Change bid close change in 2019 Czech 25.5200 25.5250 +0.02 +0.73% crown % Hungary 329.290 329.4500 +0.05 -2.49% forint 0 % Polish 4.2622 4.2665 +0.10 +0.64% zloty % Romanian 4.7528 4.7548 +0.04 -2.08% leu % Croatian 7.4450 7.4473 +0.03 -0.47% kuna % Serbian 117.340 117.4200 +0.07 #VALUE! dinar 0 % Note: calculated from 1800 daily CET change Latest Previous Daily Change close change in 2019 Prague 1072.78 1069.690 +0.29 +8.74% 0 % Budapest 42724.9 42817.55 -0.22% +9.16% 7 Warsaw 2263.78 2264.06 -0.01% -0.56% Bucharest 9671.09 9650.99 +0.21 +30.98% % Ljubljana 861.98 857.83 +0.48 +7.18% % Zagreb 1986.63 1999.43 -0.64% +13.60% Belgrade 752.00 753.78 -0.24% -1.27% Sofia 554.34 554.90 -0.10% -6.75% BONDS Yield Yield Spread Daily (bid) change vs change in Bund Czech spread Republic 2-year 1.2580 0.0580 +190b +5bps ps 5-year 1.1060 0.0400 +171b +2bps ps 10-year 1.4390 0.0420 +176b +1bps ps Poland 2-year 1.3980 -0.0150 +204b -3bps ps 5-year 1.7560 0.0210 +236b +1bps ps 10-year 2.0160 0.0460 +234b +2bps ps FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interbank Czech Rep <PR 2.22 2.20 2.12 2.17 IBOR=> Hungary <BU 0.27 0.33 0.37 0.20 BOR=> Poland <WI 1.73 1.71 1.68 1.71 BOR=> Note: FRA are for ask prices quotes ************************************************** ************ (Editing by Edmund Blair)

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