Forint 'frozen' near 22-month lows as currencies tread water
By Krisztina Than
BUDAPEST, Oct 29 (Reuters) -Central Europe's currencies were steady on Tuesday, with the Hungarian forint stuck near 22-month lows to the euro and the zloty easing as uncertainty about the U.S. presidential election and a firmer dollar weighed on the region's currencies.
"There is a slightly stronger dollar and the zloty is being sold, along with other CEE currencies... it's a reaction to the upcoming U.S. elections," said a Warsaw-based FX trader.
The dollar has been supported by anticipation that Donald Trump could win a second term as U.S. president, as his tax and tariff policies are seen as inflationary, which markets expect could keep U.S. rates high.
Hungary's forint EURHUF=, which has been the region's laggard with a 5.2% fall so far this year, was largely unchanged at 404.35 per euro at 0720 GMT.
"The forint is frozen, it could not firm past 404 to the euro in a lasting way yesterday as it moved in tandem with the zloty," brokerage Equilor said in a note.
Traders said macro data from the U.S. and also the eurozone later this week could move currency markets which were also trying to price in the Nov. 5 election in the United States.
"All in all, we anticipate a volatile week in terms of exchange rate movements," analysts at MHB Bank in Budapest said, adding that Hungarian yields also edged higher on Monday.
Investors are also waiting to see third-quarter GDP data from Hungary and the Czech Republic due on Wednesday, which could provide clues on the state of the economic recovery that has sputtered this year.
"This year is only the beginning of the healing process, as both consumer and business confidence (local and global) are limiting the Hungarian economy," ING analyst Peter Virovacz said in a note. "While consumption is already on the rise, investments have fallen off a cliff."
In Poland, the government is due to discuss amendments to the 2024 budget on Tuesday.
The zloty EURPLN= was 0.1% weaker at 4.3535 per euro.
"The złoty is weakening, although it must be admitted that the scale of depreciation remains quite limited...the level of PLN 4.37 per EUR remains an important technical level that can stop the pressure on the złoty," Bank Millennium said.
CEE MARKETS | SNAPSHOT | AT 0918 CET | ||||
CURRENCIES | ||||||
Latest | Previous | Daily | Change | |||
trade | close | change | in 2024 | |||
EURCZK= | Czech crown | EURCZK= | 25.3800 | 25.3620 | -0.07% | -2.67% |
EURHUF= | Hungary forint | EURHUF= | 404.3500 | 404.7000 | +0.09% | -5.23% |
EURPLN= | Polish zloty | EURPLN= | 4.3535 | 4.3510 | -0.06% | -0.21% |
EURRON= | Romanian leu | EURRON= | 4.9745 | 4.9740 | -0.01% | -0.00% |
EURRSD= | Serbian dinar | EURRSD= | 116.9300 | 117.0500 | +0.10% | +0.27% |
Note: daily change | calculated from | 1800 CET | ||||
Latest | Previous | Daily | Change | |||
close | change | in 2024 | ||||
.PX | Prague | .PX | 1655.89 | 1647.7200 | +0.50% | +17.11% |
.BUX | Budapest | .BUX | 74309.18 | 74122.77 | +0.25% | +22.58% |
.WIG20 | Warsaw | .WIG20 | 2249.70 | 2245.79 | +0.17% | -3.98% |
.BETI | Bucharest | .BETI | 17498.29 | 17372.05 | +0.73% | +13.84% |
Spread | Daily | |||||
vs Bund | change in | |||||
Czech Republic | spread | |||||
CZ2YT=RR | 2-year | CZ2YT=RR | 3.4190 | -0.0200 | +127bps | -4bps |
CZ5YT=RR | 5-year | CZ5YT=RR | 3.7410 | -0.0410 | +162bps | -6bps |
CZ10YT=RR | 10-year | CZ10YT=RR | 4.0590 | 0.0060 | +175bps | -2bps |
Poland | ||||||
PL2YT=RR | 2-year | PL2YT=RR | 4.8760 | 0.0240 | +273bps | +1bps |
PL5YT=RR | 5-year | PL5YT=RR | 5.5070 | 0.0140 | +339bps | -1bps |
PL10YT=RR | 10-year | PL10YT=RR | 5.9040 | 0.0880 | +360bps | +7bps |
FORWARD RATE AGREEMENTS | ||||||
3x6 | 6x9 | 9x12 | 3M interbank | |||
Czech Rep | CZKFRAPRIBOR= | 3.80 | 3.52 | 3.36 | 4.08 | |
Hungary | HUFFRABUBOR= | 6.91 | 6.82 | 6.72 | 6.43 | |
Poland | PLNFRAWIBOR= | 5.71 | 5.26 | 4.86 | 5.86 | |
Note: FRA quotes | are for ask prices | |||||
************************************************************** |
Additional reporting by Alan Charlish and Pawel Florkiewicz in Warsaw Editing by Andrew Cawthorne
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