Band Anita Komuves

BUDAPEST, September 29 (Reuters) – Central European currencies strengthened on Wednesday, with the Hungarian forint recording a five-day losing streak and the Czech crown among the top gainers a day before an expected central bank rate hike.

Czech crown EURCZK = strengthened 0.15% to 25.4620 per euro after local markets reopened after a public holiday on Tuesday, focusing mainly on the Czech central bank meeting on Thursday.

Analysts expect the bank to step up rate hikes with an increase of 50 basis points larger than usual, the first since 1997.

The Hungarian and Czech central banks began to hike rates in June to fight inflation as their economies recovered from the economic crisis caused by the pandemic.

The Hungarian forint EURHUF = edged up 0.06% and traded at 359.33 per euro, but still traded at a two-month low and near the key level of 360.

The currency fell around 2% over the past week, under pressure from a rate hike 15 basis points lower than the central bank’s expectations last week.

Rising US Treasury yields and Hungary’s feud with the European Union over several issues also weakened the forint, traders said.

“The Hungarian forint is the highest beta currency of this peer group and tends to deteriorate on risk-free moves,” Commerzbank wrote in a note.

Hungarian government bond yields on the long end of the curve retreated on Wednesday after surging in the previous session.

“The rise in US Treasury yields hit the Hungarian bond market yesterday, and yields have risen by around 10 basis points, but they have retreated somewhat today,” a fixed income trader told Budapest.

The 10-year bond yield was 3.2% on Wednesday.

Besides the rise in core market yields, the gradual reduction in the central bank’s quantitative easing program has also affected yields, another FI trader said.

The bank announced last week that bond purchases would drop from a weekly amount of 50 billion forints to 40 billion.

The central bank bought 30 billion forints ($ 98.62 million) in government bonds from commercial banks at its weekly auction on Tuesday.

CEEC MARKETS

INSTANTANEOUS

At 1041 CET

COINS

Latest

Previous

Daily

Switch

offer

close

cash

in 2021

EURCZK =

czech crown

EURCZK =

25.4620

25.5000

+ 0.15%

+ 3.01%

EURHUF =

Hungarian forint

EURHUF =

359.3300

359.5500

+ 0.06%

+ 0.94%

EURPLN =

Polish Zloty

EURPLN =

4.6269

4.6340

+ 0.15%

-1.46%

EURRON =

leu in Romanian

EURRON =

4.9492

4.9510

+ 0.04%

-1.70%

EURHRK =

Croatian Kuna

EURHRK =

7.4980

7.5015

+ 0.05%

+ 0.66%

EURRSD =

Serbian dinar

EURRSD =

117.4800

117.5800

+ 0.09%

+ 0.08%

Note: daily change

calculated from

1800 CET

Latest

Previous

Daily

Switch

close

cash

in 2021

.PX

Prague

.PX

1321.90

1322.4000

-0.04%

+ 28.70%

.BUX

Budapest

.BUX

51540.76

51446.20

+ 0.18%

+ 22.40%

.WIG20

Warsaw

.WIG20

2289.71

2275.68

+ 0.62%

+ 15.41%

.BETI

Bucharest

.BETI

12547.96

12522.92

+ 0.20%

+ 27.97%

.SBITOP

Ljubljana

.SBITOP

1168.93

1165.97

+ 0.25%

+ 29.76%

.CRBEX

Zagreb

.CRBEX

1989.63

1987.72

+ 0.10%

+ 14.39%

.BELEX15

Belgrade

.BELEX15

801.86

801.35

+ 0.06%

+ 7.11%

.SOFIX

Sofia

.SOFIX

573.36

570.10

+ 0.57%

+ 28.12%

Yield

Yield

Broadcast

Daily

(offer)

cash

against the Bund

switch

Czech Republic

broadcast

CZ2YT = RR

2 years

CZ2YT = RR

1,8950

0.0020

+258 bp

+ 0bps

CZ5YT = RR

5 years

CZ5YT = RR

1.9620

-0.0220

+251 bp

-2bps

CZ10YT = RR

10 years

CZ10YT = RR

2.0370

-0.0330

+ 224bps

-3bps

Poland

PL2YT = RR

2 years

PL2YT = RR

0.6020

-0.1240

+ 129bps

-12bps

PL5YT = RR

5 years

PL5YT = RR

1.5000

-0.0310

+205 bp

-3bps

PL10YT = RR

10 years

PL10YT = RR

2.1280

-0.0350

+ 233bps

-3bps

CHEEKY

3×6

6×9

9×12

3M Interbank

Czech Republic

CZKFRAPRIBOR =

2.22

2.57

2.82

1.17

Hungary

HUFFRABUBOR =

2.28

2.44

2.57

1.78

Poland

PLNFRAWIBOR =

0.52

0.80

1.06

0.24

Note: quotes from FRA

are for the asking prices

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

(Additional report by Jason Hovet in Prague; Editing by Ramakrishnan M.)

((komuves.anita@thomsonreuters.com) (+ 36 70 795 8815))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.