CEE MARKETS-Far from coronavirus fears, CEE assets post mild gains

By Anita Komuves
BUDAPEST, Feb 10 (Reuters) – Fears of an impact from the
coronavirus outbreak mostly bypassed emerging Europe early on
Monday, with the region considered a comparative backwater,
enabling most markets to rise slightly.
The Hungarian forint moved sideways as investors
awaited key economic data later in the week and a swap tender
that the central bank has used to fine tune liquidity.
Investors will keenly eye the National Bank of Hungary’s
afternoon swap tender, which the bank has begun to cut back as
the forint has hit record lows and eased more than 2% against
the euro this year, underperforming regional peers.
“If the NBH does not accept any bids again, the forint can
strengthen slightly,” a Budapest-based trader said, adding that
the market awaited January inflation figures due out on Thursday
even more keenly than the tender.
A significant uptick in the year-on-year inflation number
could lead to a negative effect on the forint, she said.
Inflation may have accelerated to 4.3% in January from 4.0%
in December, according to a Reuters poll. That exceeds the NBH’s
target range of 3% plus/minus 1%.
Hungary’s ultra-dovish central bank has kept interest rates
at a record low.
The Czech crown was a touch stronger, hanging on
the weak side of the pyschological 25 per euro level.
The crown briefly broke that key level for the first time
since 2012 last week. Analysts at bank CSOB said the central
bank’s surprise rate hike last week would continue to buoy the
currency even as the global market remained bearish.
The Czech central bank raised the main two-week repo rate by
25 basis points to 2.25%.
While Asian and several European stock markets dropped on
Monday morning because of continuing global worries about the
coronavirus outbreak, most CEE markets posted gains.
Prague gained 0.2%, Budapest was up by 0.8%
while Romanian markets were up by 0.3%. Warsaw
was down by 0.6%.

CEE SNAPSHOT AT
MARKETS 1140 CET
CURRENCI
ES
Latest Previous Daily Change
bid close change in 2020
Czech 25.0180 25.0570 +0.16% +1.65%
crown
Hungary 337.9000 338.1000 +0.06% -2.00%
forint
Polish 4.2686 4.2748 +0.15% -0.29%
zloty
Romanian 4.7660 4.7610 -0.10% +0.47%
leu
Croatian 7.4518 7.4565 +0.06% -0.09%
kuna
Serbian 117.5000 117.5900 +0.08% +0.06%
dinar
Note: calculated from 1800 CET
daily
change

Latest Previous Daily Change
close change in 2020
Prague 1113.25 1110.720 +0.23% -0.21%
0
Budapest 44854.21 44486.92 +0.83% -2.67%
Warsaw 2097.93 2110.20 -0.58% -2.43%
Bucharest 10053.59 10025.59 +0.28% +0.76%
Ljubljana 978.93 978.16 +0.08% +5.73%
Zagreb 2029.32 2027.35 +0.10% +0.59%
Belgrade <.BELEX15 810.55 812.86 -0.28% +1.11%
>
Sofia 572.80 569.62 +0.56% +0.82%

Yield Yield Spread Daily
(bid) change vs Bund change
in
Czech spread
Republic
2-year <CZ2YT=RR 1.9570 0.1370 +260bps +15bps
>
5-year <CZ5YT=RR 1.6430 -0.0660 +226bps -5bps
>
10-year <CZ10YT=R 1.5940 0.0570 +200bps +8bps
R>
Poland
2-year <PL2YT=RR 1.5260 -0.0060 +217bps +0bps
>
5-year <PL5YT=RR 1.7520 -0.0160 +237bps +0bps
>
10-year <PL10YT=R 2.0840 0.0000 +249bps +2bps
R>
FORWARD
3×6 6×9 9×12 3M
interban
k
Czech Rep < 2.37 2.32 2.24 2.39
PRIBOR=>
Hungary < 0.34 0.42 0.50 0.32
BUBOR=>
Poland < 1.73 1.71 1.69 1.71
WIBOR=>
Note: FRA are for ask prices
quotes
**************************************************
************

(Additional reporting by Jason Hovet in Prague, Editing by
William Maclean)

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