PRAGUE, Feb 17 (Reuters) - Budapest stocks rose to a near
one-year high on Wednesday and were set for a third straight
session of gains, while other bourses retreated on weaker global
cues and currencies eased.
The Czech crown touched a one-week low and its
regional peers also weakened as the U.S. dollar gained strength.
Czech bond yields ticked up ahead of a debt auction, the
first since the finance ministry this week proposed a
larger-than-expected upward revision to the 2021 budget gap, to
a record 500 billion crowns ($23 billion).
Dealers said the sale should be another test of investor
appetite, which has stayed solid this year.
Czech bond yields have risen faster than others in central
Europe amid caution over fiscal plans and expectations the Czech
central bank could become the first in the region to hike
interest rates later this year.
In Hungary, the forint dropped 0.1% to 359.20 per
euro. The domestic stock index rose 0.3% to its highest
since Feb. 24 at 1020 GMT, led by a more than 1% gain in OTP
after the bank"s shares crossed a key resistance
level.
Central European markets have been bolstered by
better-than-expected fourth-quarter economic growth in the past
few weeks.
The data showed the economies remained resilient despite a
harsher wave of the year-old COVID-19 pandemic, although
uncertainties persist due to lockdown rules.
On Wednesday, official data showed that Polish corporate
sector wages rose by 4.8% in January, below expectations.
"Everything indicates that until the epidemic situation
improves significantly and uncertainty is reduced, the domestic
labor market does not seem to have the potential for a major
rebound," said Kamil Luczkowski, an economist at Bank Pekao.
"We expect a clear recovery in the labour market only in the
second half of the year, along with a recovery in the entire
economy."
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