PRAGUE, Dec 21 (Reuters) - Poland"s zloty dropped on Monday
to its lowest level since early November while stock markets in
central Europe were on course for their biggest one-day fall
since at least October as a new coronavirus strain in Britain
rattled markets.
The United Kingdom stood shut off from the rest of Europe on
Monday after much of the continent cut transport ties with it
over fears of the new fast-spreading strain.
News of the new variant, possibly up to 70% more
transmissible than the original, shook markets and pushed stocks
in central Europe sharply lower.
Warsaw had dropped 4.5% by 1041 GMT and Budapest
was down 2.7%, both showing their biggest one-day drops
since the end of October. Prague fell 3.7%, on course for
its biggest one-day drop since June.
On currency markets, the zloty lost 1.0% to 4.525
to the euro, one trading day after the Polish central bank
stepped into markets to weaken the currency in a move that led
to its biggest daily drop since September.
Polish rate setter Eryk Lon confirmed on Monday the central
bank had intervened.
The zloty stayed under pressure with the rest of the region
amid the risk-off mood on Monday. Hungary"s dropped
1.0% to 361.35 per euro and the Czech crown retreated
0.6% to 26.34. Romania"s leu held steady.
"The attempt in Poland to weaken the zloty has had a bit of
an effect on other markets, dragging the forint along, although
it must be added that trading is extremely thin so any effect is
outsized," a Budapest dealer said.
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