CEE MARKETS-Ailing forint steadies ahead of pivotal cenbank rate meeting
By Anita Komuves BUDAPEST, Nov 16 (Reuters) - The Hungarian forint was flat ahead of an expected central bank rate hike due later on Tuesday, a move that could cause volatility in the currency's exchange rate. Uncertainty over by how much the bank would be willing to raise rates lingered in markets. A Reuters poll of analysts forecast a 30-basis-point hike to 2.1%, however, analysts and traders have said the National Bank of Hungary (NBH) needs to ramp up the pace of its tightening as October inflation jumped above expectations. "I think the forint needs an at least 50 basis-point hike and some very hawkish comments to be able to firm as the dollar's strength is not helping the currency either," an FX trader in Budapest said. The NBH slowed the pace of rate rises to 15 bps in September from 30 bps previously, and followed that with another 15 bps hike in October. The forint was steady on the day, trading at 365.75 per euro, about a percent off its April 2020 all-time low. It had eased more than 3% versus the euro since the bank's September decision to slow the pace of rate hikes. "Most investors are now expecting a hike of more than 30 basis points, which buoys the forint this morning," another trader said. "Due to the increased expectations the forint's market could be very hectic after the rate decision." The forint has also been pressured by bigger-than-expected rate hikes from the Polish and the Czech central banks earlier this month to counter rising inflation. However, analysts said that faltering growth and rising COVID-19 cases could make central banks in the region more cautious in coming months as data showed that CEE economies grew below expectations in the third quarter. Elsewhere, the Czech crown and the Romanian leu were stable. The Polish zloty slid 0.3% to 4.6596 per euro. Rate setter Eugeniusz Gatnar said two more rate hikes of 50 basis points each in December and January were needed. Stocks in the region gained, with Budapest adding 0.66% and Bucharest up 0.58%. Prague was up 0.46% higher and Warsaw's equities gained 0.27%. CEE SNAPSHO AT MARKETS T 1039 CET CURRENC IES Latest Previou Daily Change s bid close change in 2021 EURCZK Czech <EURCZK 25.2400 25.2380 -0.01% +3.92 = crown => % EURHUF Hungary <EURHUF 365.750 365.740 -0.00% -0.83% = forint => 0 0 EURPLN Polish <EURPLN 4.6596 4.6440 -0.33% -2.15% = zloty => EURRON Romanian <EURRON 4.9495 4.9500 +0.01% -1.71% = leu => EURHRK Croatian <EURHRK 7.5090 7.5095 +0.01% +0.51 = kuna => % EURRSD Serbian <EURRSD 117.480 117.580 +0.09% +0.08 = dinar => 0 0 % Note: calculated from 1800 daily CET change Latest Previou Daily Change s close change in 2021 .PX Prague 1386.13 1379.79 +0.46% +34.9 00 5% .BUX Budapest 52129.1 51789.8 +0.66% +23.8 7 0 0% .WIG20 Warsaw <.WIG20 2341.26 2335.04 +0.27% +18.0 > 1% .BETI Buchares 12907.7 12832.8 +0.58% +31.6 t 3 9 4% .SBITO Ljubljan <.SBITO 1229.22 1225.46 +0.31% +36.4 P a P> 5% .CRBEX Zagreb <.CRBEX 1998.31 2000.19 -0.09% +14.8 > 9% .BELEX Belgrade <.BELEX 817.41 815.81 +0.20% +9.19 15 15> % .SOFIX Sofia <.SOFIX 602.77 606.08 -0.55% +34.6 > 9% Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic CZ2YT= 2-year <CZ2YT= 3.3000 0.0040 +400bp -2bps RR RR> s CZ5YT= 5-year <CZ5YT= 2.9950 -0.0010 +353bp -2bps RR RR> s CZ10YT <CZ10YT 2.7990 0.0040 +303bp -1bps =RR 10-year =RR> s Poland PL2YT= 2-year <PL2YT= 2.9470 -0.1980 +365bp -22bps RR RR> s PL5YT= 5-year <PL5YT= 3.1410 -0.0110 +367bp -3bps RR RR> s PL10YT <PL10YT 3.0040 0.0350 +323bp +2bps =RR 10-year =RR> s FORWARD 3x6 6x9 9x12 3M interb ank Czech <CZKFRA 4.23 4.19 4.07 3.12 Rep ><PRIBO R=> Hungary <HUFFRA 3.51 3.94 4.15 2.22 ><BUBOR => Poland <PLNFRA 3.01 3.26 3.33 1.62 ><WIBOR => Note: are for ask FRA prices quotes ******************************************** ****************** (Reporting by Anita Komuves in Budapest; Editing by Amy Caren Daniel)
