UPDATE 1-CEE MARKETS-Forint rebounds after hawkish central bank messages

- Advertisement -


 (Updates with cenbank statement, press conference, forint
reaction)
    By Anita Komuves
    BUDAPEST, Nov 16 (Businesshala) - The Hungarian forint firmed on
Tuesday, boosted by hawkish messages from the central bank after
it raised its base rate by 30 basis points in line with
forecasts but disappointing some investors.
    The forint rebounded after the National Bank of Hungary
(NBH) pledged a "more extensive and longer lasting" policy
tightening to curb rising inflation risks and anchor
inflationary expectations.
    The currency was 0.4% up on the day and trading at
364.27 by 1504 GMT. 
    The forint was helped by Deputy Governor Barnabas Virag's
press conference at which he announced new monetary policy tools
and said that the NBH must be ready to set the interest rate on
one-week deposits above the base rate, two FX traders said. 
    "The bank will try to support the forint with a higher
one-week deposit rate, but the big question is how much higher
it will be," one trader said.
    The bank sets the interest rate on its one-week deposit
facility on Thursday at its weekly tender.
    Uncertainty over by how much the bank would be willing to
raise rates had worried markets over the past weeks, putting
pressure on the forint. 
    "The central bank will need to maintain large interest rate
hikes at its upcoming meetings to prevent the forint from coming
under further downward pressure," Liam Peach at Capital
Economics wrote in a client note.    
    Long-term government bond yields were not immediately moved
by the rate hike, a fixed-income trader said.
    The forint has also been pressured by larger-than-expected
rate hikes from the Polish and the Czech central banks earlier
this month to counter 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 little moved.
    The Polish zloty slid 0.25% to 4.6555 per euro.
Rate setter Eugeniusz Gatnar said two more rate hikes of 50 bps
each in December and January were needed.
    
                   CEE      SNAPSHO   AT                     
                   MARKETS  T        1604              
                                     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:     calculated from            1800           
         daily                                CET      
         change Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in
                                                       2021
 .PX     Prague             1383.20  1379.79   +0.25%   +34.6
                                          00               7%
 .BUX    Budapest           51890.0  51789.8   +0.19%   +23.2
                                  1        0               3%
 .WIG20  Warsaw    <.WIG20  2339.73  2335.04   +0.20%   +17.9
                   >                                       3%
 .BETI   Buchares           12845.0  12832.8   +0.09%   +31.0
         t                        3        9               0%
 .SBITO  Ljubljan  <.SBITO  1227.85  1225.46   +0.20%   +36.3
 P       a         P>                                      0%
 .CRBEX  Zagreb    <.CRBEX  1994.07  2000.19   -0.31%   +14.6
                   >                                       5%
 .BELEX  Belgrade  <.BELEX   813.65   815.81   -0.26%   +8.69
 15                15>                                      %
 .SOFIX  Sofia     <.SOFIX   608.76   606.08   +0.44%   +36.0
                   >                                       3%
                                                             
                            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  
                   FORWARD                                   
                            3x6      6x9      9x12     3M
                                                       interb
                                                       ank
         Czech                                      
         Hungary                                     
         Poland                                      
         Note:     are for ask                               
         FRA       prices                              
         quotes                                        
         ********************************************        
         ******************                            
 

 (Reporting by Anita Komuves in Budapest; Editing by Amy Caren
Daniel, Mark Heinrich and Nick Macfie)
  
 
 
- Advertisement -

- Advertisement -

,

- Advertisement -

Stay on top - Get the daily news in your inbox

DMCA / Correction Notice

Recent Articles

Related Stories

Stay on top - Get the daily news in your inbox