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Home›Serbian banks›MARKETS CEE-Forint, stocks weaken after Hungary announces exceptional taxes

MARKETS CEE-Forint, stocks weaken after Hungary announces exceptional taxes

By Corey Owens
May 27, 2022
0
0

Band Anita Komuves

BUDAPEST, May 27 (Reuters) – The Hungarian forint edged lower as stocks extended losses on Friday as markets weighed the impact of new windfall taxes worth 800 billion forints ($2.19 billion) on ‘additional profits’ made by banks, energy companies and other businesses.

The taxes aim to help reduce the budget deficit this year and next, the Hungarian government announced on Thursday. About 60% of the deficit adjustment will come from spending cuts while new taxes will make up the rest.

the forint EURHUF= fell 0.06% and traded at 393 per euro on Friday, ending its steep losses of the previous two sessions. The Budapest Stock Index .BUX fell 0.65%, adding to Thursday’s losses when the government’s announcement rattled investors, sending blue-chip stocks down sharply.

“The forint has stabilized but is stuck at a low level,” said an FX in Budapest. “The market was certainly not happy with this package, but it could help if the government really tried to get the deficit under control.”

Yields on long-term government bonds were flat after rising 20 basis points in the previous session, a fixed-income trader said. The yield on the 10-year bond was around 6.98%.

Investors were also watching the central bank’s rate-setting meeting scheduled for next Tuesday, where a Reuters poll of analysts expects the bank to slow the pace of its rate hikes, raising its base rate by 60 basis points. 6.0% basis.

Deputy Governor Barnabas Virag said on Tuesday that the central bank could slow the pace of rate hikes to about half of the 100 basis point steps issued over the past two months.

On Friday, the bank said it would hold four FX swap tenders providing liquidity in euros and two auctions of discounted short-term bills in June, to “enhance the efficiency of monetary transmission”.

Elsewhere, the Polish zloty failed to enjoy the widely expected approval of a judicial reform bill that paves the way for Poland to secure billions in COVID-19 recovery funds from the European Union .

The zloty EURPLN= was down 0.13% and traded at 4.6080 per euro.

The Czech crown EURCZK= and the Romanian leu EURRON= were flat.

CEE MARKETS

INSTANTANEOUS

At 11:22 a.m. CET

CURRENCIES

Last

Previous

Daily

To change

offer

close

change

in 2022

EURCZK=

Czech koruna

EURCZK=

24.7100

24.7100

+0.00%

+0.66%

EURHUF=

Hungarian forint

EURHUF=

393.0000

392.7500

-0.06%

-6.01%

EURPLN=

polish zloty

EURPLN=

4.6080

4.6020

-0.13%

-0.37%

EURRON=

lei in Romanian

EURRON=

4.9433

4.9432

-0.00%

+0.10%

EURHRK=

Croatian kuna

EURHRK=

7.5340

7.5345

+0.01%

-0.22%

EURRSD=

Serbian dinar

EURRSD=

117.4500

117.4900

+0.03%

+0.11%

Note: daily change

calculated from

1800 CET

Last

Previous

Daily

To change

close

change

in 2022

.PX

prague

.PX

1313.96

1310.5800

+0.26%

.BUX

Budapest

.BUX

38978.13

39234.20

-0.65%

-23.15%

.WIG20

Warsaw

.WIG20

1807.98

1827.01

-1.04%

-20.25%

.BETI

Bucharest

.BETI

12398.10

12323.91

+0.60%

-5.08%

.SBITOP

Ljubljana

.SBITOP

1134.50

1131.07

+0.30%

-9.64%

.CRBEX

Zagreb

.CRBEX

2092.51

2088.01

+0.22%

+0.63%

.BELEX15

Belgrade

.BELEX15

818.69

816.56

+0.26%

-0.25%

.SOFIX

Sofia

.SOFIX

613.82

610.42

+0.56%

-3.44%

Yield

Yield

Spread

Daily

(offer)

change

vs. Bunds

to change

Czech Republic

spread

CZ2YT=RR

2 years

CZ2YT=RR

5.4860

-0.0220

+513 basis points

-5bps

CZ5YT=RR

5 years

CZ5YT=RR

4.9270

-0.0890

+424bps

-10bps

CZ10YT=RR

10 years

CZ10YT=RR

4.6520

-0.0080

+366 basis points

-1bps

Poland

PL2YT=RR

2 years

PL2YT=RR

6.4440

0.0380

+609 basis points

+1 basis points

PL5YT=RR

5 years

PL5YT=RR

6.9160

0.0200

+623bps

+1 basis points

PL10YT=RR

10 years

PL10YT=RR

6.7030

0.0380

+571 basis points

+4 base points

FORWARD

3×6

6×9

9×12

3M interbank

Czech Republic

CZKFRAPRIBOUR=

6.84

6.77

6.58

6.14

Hungary

OYSTERBUBOR=

7.91

8.39

8.44

6.85

Poland

PLNFRAWIBOR=

7.66

7.83

7.81

6.53

Note: ENG Quotes

are for asking prices

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

(Additional reporting by Alan Charlish in Warsaw; Editing by Krishna Chandra Eluri)

((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.

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