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FX steady after ECB rate cut



<html xmlns="http://www.w3.org/1999/xhtml"><head><title>CEE MARKETS-FX steady after ECB rate cut</title></head><body>

By Alan Charlish

WARSAW, Sept 13 (Reuters) -Central European currencies hovered near recent levels on Friday, as markets pared back bets on further easing from the European Central Bank and weighed inflation data from Poland.

The ECB cut interest rates again on Thursday and signalled a "declining path" for borrowing costs in the months ahead.

However, sources told Reuters that a further rate cut at its next meeting in October was unlikely barring a major deterioration in the outlook for growth.

Czech bank CSOB said indications showed the ECB "would like to stick to a relatively cautious quarterly tempo of rate cuts, which would of course be important news not only for the euro/dollar but also regional currencies and central banks".

The Czech crown EURCZK= was 0.07% weaker against the euro at 0929 GMT.

On Friday, Poland's statistics office said that inflation was 4.3% year-on-year in August, in line with a flash estimate.

"The zloty is stable... we have this CPI data which is a non-event for the market," said a Warsaw-based currency trader.

"On Friday I think position squaring will dominate and we are just preparing for the weekend."

The zloty EURPLN= was 0.08% weaker at 4.289.

"We expect that at the turn of the week the EUR/PLN pair will reach 4.30 again, and next week it will break above this level," ING analysts said in a note.

PKO analysts said they expect the zloty to be supported going forward by an improved interest rate differential between Poland and core markets.

The National Bank of Poland has ruled out rate cuts this year and Governor Adam Glapinski has said he hopes the Monetary Policy Council can start discussing interest rate cuts after next March.

The Hungarian forint EURHUF= was 0.11% softer at 395.85.

"The euro-forint rate has reached a very important technical support level, which lies between 394-395," said Zoltan Varga, an analyst at brokerage Equilor.

"So far, it has not been able to break it down, so it cannot be ruled out that it will soon head back towards the 397.50 level, which is the first major short-term technical resistance."





CEE MARKETS

SNAPSHOT

AT 1129 CET






CURRENCIES







Latest

Previous

Daily

Change




trade

close

change

in 2024

EURCZK=

Czech crown

EURCZK=

25.1400

25.1230

-0.07%

-1.74%

EURHUF=

Hungary forint

EURHUF=

395.8500

395.4000

-0.11%

-3.20%

EURPLN=

Polish zloty

EURPLN=

4.2890

4.2855

-0.08%

+1.29%

EURRON=

Romanian leu

EURRON=

4.9741

4.9748

+0.01%

+0.00%

EURRSD=

Serbian dinar

EURRSD=

116.9700

117.0200

+0.04%

+0.24%


Note: daily change

calculated from



1800 CET












Latest

Previous

Daily

Change





close

change

in 2024

.PX

Prague

.PX

1576.72

1577.5500

-0.05%

+11.51%

.BUX

Budapest

.BUX

72396.96

72340.83

+0.08%

+19.43%

.WIG20

Warsaw

.WIG20

2309.87

2294.32

+0.68%

-1.41%

.BETI

Bucharest

.BETI

17382.91

17327.43

+0.32%

+13.09%













Spread

Daily






vs Bund

change in


Czech Republic





spread

CZ2YT=RR

2-year

CZ2YT=RR

3.2510

-0.0120

+106bps

+3bps

CZ5YT=RR

5-year

CZ5YT=RR

3.3970

-0.0580

+140bps

-3bps

CZ10YT=RR

10-year

CZ10YT=RR

3.6660

-0.0310

+153bps

-1bps


Poland






PL2YT=RR

2-year

PL2YT=RR

4.6140

-0.0090

+242bps

+3bps

PL5YT=RR

5-year

PL5YT=RR

4.9520

-0.0550

+295bps

-2bps

PL10YT=RR

10-year

PL10YT=RR

5.2450

-0.0570

+311bps

-3bps










FORWARD RATE AGREEMENTS








3x6

6x9

9x12

3M interbank


Czech Rep

CZKFRAPRIBOR=

3.86

3.50

3.17

4.33


Hungary

HUFFRABUBOR=

6.57

6.08

5.55

6.48


Poland

PLNFRAWIBOR=

5.73

5.29

4.74

5.85


Note: FRA quotes

are for ask prices






**************************************************************








Reporting by Alan Charlish and Pawel Florkiewicz in Warsaw, Jason Hovet in Prague; Editing by Mrigank Dhaniwala

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