CEE MARKETS-Stocks halt gains, FX buoyed by rate hike hopes
By Anita Komuves BUDAPEST, Aug 16 (Reuters) - Central European stocks slid on Monday, halting record-setting gains from last week as investors were concerned about slower economic growth in China and the spread of the coronavirus. Equities in the region tracked peers in Europe, where a 10-day run of gains came to a halt following a surprise slowdown in China's economic indicators. Budapest's stocks were 0.18% lower while Prague slid 0.13%. Warsaw was 0.36% lower. Bucharest's stocks bucked the trend and were up 0.18%. The Hungarian forint firmed 0.28% to a five-week high of 351.70 per euro, breaking the strong resistance level at 352.30 that stopped its strengthening last week. After this level is broken, the road is open for the currency to strengthen as far as 350, brokerage Equilor wrote. The forint has recently been supported by the rate hike cycle that the central bank started in June in order to fight inflation. Rate hikes and expectations of further policy tightening are also buoying the Czech crown. A larger-than-expected inflation spike reported last week raised chances the central bank may opt for a bigger-than-usual rate increase after two consecutive 25-basis-point hikes. Czech producer prices accelerated again in July, with the year-on-year figure at 7.8%, accelerating from 6.1% in June, data showed on Monday. "This means that inflationary pressures on producer prices will not abate any time soon," Raiffeisenbank's analyst David Vagenknecht said in a note. The Czech crown was up 0.11% on the day and was trading at 25.390 versus the common currency. The Polish zloty was flat. "The valuation of the zloty is still affected by the MPC's dovish rhetoric," Bank Millennium wrote. "Although the latest statements of the MPC members signal an imminent perspective of monetary policy normalisation, giving support to the zloty." Polish central banker Jerzy Kropiwnicki said on Thursday that he would vote for a 15 basis point rate hike in November, assuming the outlook for economic growth was good. CEE SNAPSHO AT MARKETS T 1111 CET CURRENC IES Latest Previous Daily Change bid close change in 2021 EURCZK= Czech <EURCZK= 25.3900 25.4170 +0.11% +3.30% crown > EURHUF= Hungary <EURHUF= 351.700 352.7000 +0.28% +3.13% forint > 0 EURPLN= Polish <EURPLN= 4.5650 4.5650 +0.00% -0.13% zloty > EURRON= Romania <EURRON= 4.9124 4.9095 -0.06% -0.96% n leu > EURHRK= Croatia <EURHRK= 7.4980 7.4985 +0.01% +0.66% n kuna > EURRSD= Serbian <EURRSD= 117.480 117.5500 +0.06% +0.08% dinar > 0 Note: calculated from 1800 daily CET change Latest Previous Daily Change close change in 2021 .PX Prague 1273.57 1275.270 -0.13% +23.99 0 % .BUX Budapes 50287.4 50378.65 -0.18% +19.43 t 4 % .WIG20 Warsaw 2293.83 2302.03 -0.36% +15.62 % .BETI Buchare 12158.3 12136.73 +0.18% +23.99 st 8 % .SBITOP Ljublja <.SBITOP 1194.08 1190.14 +0.33% +32.55 na > % .CRBEX Zagreb 1966.89 1967.29 -0.02% +13.09 % .BELEX1 Belgrad <.BELEX1 797.31 796.33 +0.12% +6.51% 5 e 5> .SOFIX Sofia 584.08 582.59 +0.26% +30.51 % Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republi c CZ2YT=R <CZ2YT=R 1.6760 -0.0030 +242bp +0bps R 2-year R> s CZ5YT=R <CZ5YT=R 1.8140 -0.0020 +254bp +0bps R 5-year R> s CZ10YT= <CZ10YT= 1.8800 0.0040 +234bp +0bps RR 10-year RR> s Poland PL2YT=R <PL2YT=R 0.3830 -0.1080 +113bp -10bps R 2-year R> s PL5YT=R <PL5YT=R 1.1010 -0.0620 +183bp -6bps R 5-year R> s PL10YT= <PL10YT= 1.7540 -0.0410 +222bp -4bps RR 10-year RR> s FORWARD 3x6 6x9 9x12 3M interba nk Czech 1.67 2.06 2.23 0.97 Rep <PRIBOR= > Hungary 2.09 2.20 2.27 1.38 Poland 0.44 0.64 0.85 0.21 Note: are for ask FRA prices quotes ********************************************* ***************** (Additional reporting by Alicja Ptak in Warsaw and Robert Muller in Prague; Editing by Subhranshu Sahu)
