CEE MARKETS-Currencies in holding pattern before U.S. inflation data

  • 9/14/2021
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PRAGUE, Sept 14 (Reuters) - Central European currencies were caught in a holding pattern on Tuesday as global markets awaited key U.S. inflation data, with the Hungarian forint and Czech crown retaining recent gains. Hungary"s central bank said on Monday it would scrap its swap tender providing forint liquidity and hold an additional tender to provide euro liquidity to the banking system on Wednesday, giving the forint a boost. The forint mostly held onto those gains on Tuesday, sticking on the strong side of the psychological 350 per euro level. It traded at 349.60, up 0.2%, at 0836 GMT. The forint and crown have outpaced gains by peers in central Europe so far this year, with their respective central banks both in policy tightening mode since June. In the Czech Republic, market speculation has shifted to whether the central bank may opt for a steeper 50 basis point rate hike when it next meets at the end of September. The central bank has so far delivered two 25 basis point hikes. On Tuesday, Czech central banker Vojtech Benda, who has backed a heftier 50 basis point hike at the last two meetings, told Czech Radio his position had not softened, with data last week showing inflation had hit a 13-year high. The crown inched down 0.1% to 25.38 to the euro and was off a three-month high hit last week after the latest inflation data. In Poland, the zloty also dipped 0.1%, with little impulse. It has lost 0.7% this month. "Investors" attention will focus on the U.S. inflation reading, which is likely to confirm continued high price pressures, although this should not advance the timing of the Fed"s monetary policy normalisation," Bank Millennium said. "Space for further weakening of the zloty is small." Elsewhere, stock markets were mixed, with Budapest and Warsaw softening. Prague was held higher by gains for utility CEZ and MONETA Money Bank and Komercni Banka after the latter two got regulator clearance to pay a scaled-back dividend. CEE SNAPSHO AT MARKETS T 1036 CET CURRENC IES Latest Previou Daily Change s bid close change in 2021 EURCZK Czech EURHUF Hungary 0 0 EURPLN Polish EURRON Romanian EURHRK Croatian EURRSD Serbian 0 0 Note: calcula 1800 daily ted CET change from STOCKS Latest Previou Daily Change s close change in 2021 .PX Prague 1292.65 1288.89 +0.29% +25.85 00 % .BUX Budapest 52789.4 52922.7 -0.25% +25.37 7 2 % .WIG20 Warsaw <.WIG20 2363.96 2387.74 -1.00% +19.15 > % .BETI Buchares 12294.3 12327.5 -0.27% +25.38 t 4 8 % .SBITO Ljubljan <.SBITO 1180.11 1178.66 +0.12% +31.00 P a P> % .CRBEX Zagreb <.CRBEX 1967.69 1968.71 -0.05% +13.13 > % .BELEX Belgrade <.BELEX 805.44 808.25 -0.35% +7.59% 15 15> .SOFIX Sofia <.SOFIX 565.77 565.83 -0.01% +26.42 > % BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic CZ2YT= 2-year s CZ5YT= 5-year s CZ10YT s Poland PL2YT= 2-year s PL5YT= 5-year s PL10YT s FRA 3x6 6x9 9x12 3M interba nk Czech Hungary Poland Note: FRA quotes are for ask prices *********************************** *************************** (Reporting by Jason Hovet in Prague, Alicja Ptak in Warsaw and Gergely Szakacs in Budapest; Editing by Alexander Smith

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