PRAGUE, Dec 27 (Reuters) - Central Europe's currencies started the final trading week of 2021 on softer footing, as worries over the economic impact from the Omicron coronavirus variant weighed on global assets, pushing the Czech crown off a 22-month high.
The crown had pierced the psychological 25 per euro level — the first time since the start of the COVID-19 pandemic - in thin holiday trade on Friday in the wake of the Czech central bank delivering a third straight hefty interest rate hike last week.
It retreated on Monday with rest of central Europe as local markets got back into action.
With the Czech central bank leaving scope for further hikes, though, analysts see another test of the 25-level in sight before the year-end.
"It is likely the crown will again test 25," CSOB said, adding a real break of that level was possible in the new year.
"The rate differential and easing of the pandemic is currently playing into this."
Coronavirus infections have eased in the past few weeks in central Europe although the region has yet to really face a spike on Omicron cases like in western Europe.
The Czech central bank has been the most aggressive among central Europe's rate setters this year as the region has turned to sharp policy tightening to tackle soaring inflation at multi-year highs.
The crown, in turn, has been the region's biggest gainer, up over 4.5% since the start of the year. It was down 0.3% at 25.08 to the euro at 0952 GMT.
Hungary's forint has dropped this year despite rising interest rates, with a six-month freeze of retail mortgage rates the latest concern for investors, adding to ongoing risks like Budapest's disputes with the European Union.
On Monday, the forint fell 0.3% to 371.19 to the euro, just off an all-time low of 372.
The Polish zloty also slipped 0.1%.
Stock markets were mixed, with Warsaw down half a percent and Prague a touch in the red, while Budapest inched up.
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CEE MARKETS |
SNAPSHOT |
AT 1052 CET |
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CURRENCIES |
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Latest |
Previous |
Daily |
Change |
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bid |
close |
change |
in 2021 |
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EURCZK= |
Czech crown |
25.0800 |
25.0075 |
-0.29% |
+4.58% |
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EURHUF= |
Hungary forint |
371.1900 |
369.9400 |
-0.34% |
-2.28% |
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EURPLN= |
Polish zloty |
4.6250 |
4.6201 |
-0.11% |
-1.42% |
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EURRON= |
Romanian leu |
4.9495 |
4.9498 |
+0.01% |
-1.71% |
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EURHRK= |
Croatian kuna |
7.5060 |
7.5125 |
+0.09% |
+0.55% |
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EURRSD= |
Serbian dinar |
117.4800 |
117.5800 |
+0.09% |
+0.08% |
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Note: daily change |
calculated from |
1800 CET |
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STOCKS |
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Latest |
Previous |
Daily |
Change |
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close |
change |
in 2021 |
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.PX |
Prague |
(.PX) |
1423.73 |
1425.2600 |
-0.11% |
+38.61% |
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.BUX |
Budapest |
(.BUX) |
49803.23 |
49762.24 |
+0.08% |
+18.28% |
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.WIG20 |
Warsaw |
(.WIG20) |
2215.85 |
2225.80 |
-0.45% |
+11.69% |
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.BETI |
Bucharest |
(.BETI) |
12671.49 |
12591.82 |
+0.63% |
+29.23% |
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.SBITOP |
Ljubljana |
(.SBITOP) |
1250.29 |
1236.74 |
+1.10% |
+38.79% |
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.CRBEX |
Zagreb |
(.CRBEX) |
2047.79 |
2042.76 |
+0.25% |
+17.74% |
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.BELEX15 |
Belgrade |
(.BELEX15) |
827.43 |
828.20 |
-0.09% |
+10.53% |
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.SOFIX |
Sofia |
(.SOFIX) |
633.31 |
633.31 |
+0.00% |
+41.51% |
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BONDS |
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Yield |
Yield |
Spread |
Daily |
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(bid) |
change |
vs Bund |
change in |
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Czech Republic |
spread |
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CZ2YT=RR |
2-year |
3.7140 |
0.0230 |
+436bps |
-2bps |
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CZ5YT=RR |
5-year |
3.2870 |
0.0090 |
+378bps |
+0bps |
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CZ10YT=RR |
10-year |
2.9710 |
0.0230 |
+320bps |
+0bps |
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Poland |
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PL2YT=RR |
2-year |
3.1870 |
-0.0060 |
+383bps |
-5bps |
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PL5YT=RR |
5-year |
3.8740 |
-0.0120 |
+437bps |
-2bps |
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PL10YT=RR |
10-year |
3.5530 |
0.0490 |
+378bps |
+3bps |
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FRA |
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3x6 |
6x9 |
9x12 |
3M interbank |
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Czech Rep |
4.61 |
4.13 |
3.99 |
4.05 |
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Hungary |
5.06 |
5.18 |
5.19 |
4.03 |
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Poland |
3.64 |
3.91 |
3.92 |
2.45 |
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Note: FRA quotes are for ask prices |
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Reporting by Jason Hovet in Prague; editing by Uttaresh.V
Source: Reuters