(refiles to remove erroneous letters in headline)
(Adds fixed income, detail on Hungary's output data)
WARSAW, Feb 6 (Reuters) - The Hungarian forint gained
significantly to the euro despite the fact the country's
industrial output fell nearly 20 percent in December and
analysts said further growth forecast revisions are likely to
show a much deeper recession.
At 0907 GMT the forint <EURHUF=> was up more than 1.5
percent against the euro, while the Polish zloty <EURPLN=> and
the Czech crown <EURCZK=> were tracking its regional peer,
strengthening 1.4 percent and 0.7 percent respectively.
"I think the market knows pretty well that there are two
kinds of Hungarian data, bad and extremely bad. As such, it does
not really react to such news, let alone firm on it. The gains
this morning were driven by general profit taking in CEE," the
Budapest-based trader said.
He said currencies could also be boosted by the recent
Polish central banker comment, who suggested Poland's Monetary
Policy Council may talk about a possible FX intervention if a
sharp fall of the zloty threatened the inflation target.
"There is a strong correlation among regional currencies, so
despite the poor (Hungarian) data, the (currencies) seem to have
lost their easing momentum," the trader said.
Analysts in Poland said despite the fact the global
recession hit all markets in the region, there is a sign the
forex market may calm down in the coming months.
"Investors began to bet on volatility to fall which means
they expect changes on currencies to become less significant,"
said Lukasz Wojtkowiak, FX analyst at Millennium Bank.
He said, however, that this did not mean currencies would
stop falling. "But even if we have 5 zlotys against the euro,
further weakening is unlikely to be that sharp."
The Polish currency was at its highest volatility in the
fourth quarter of 2008.
In the Czech Republic dealers said the currency is likely to
move in a range after falling below 28.0 to the euro when the
central bank released an exchange rate forecast for the first
time, setting it at levels much stronger than nowadays.
"The crisis is still at a start," the Prague-based trader
said.
----------------------MARKET SNAPSHOT-------------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 27.755 27.945 +0.68% -3.61%
Polish zloty <EURPLN=> 4.547 4.612 +1.43% -9.5%
Hungarian forint <EURHUF=> 288.76 293.23 +1.55% -8.73%
Croatian kuna <EURHRK=> 7.4 7.4 0% -0.47%
Romanian leu <EURRON=> 4.211 4.25 +0.93% -4.67%
Serbian dinar <EURRSD=> 91.689 91.726 +0.04% -2.41%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond CZ2YT=RR +45 basis points to 145bps over bmk*
4-yr T-bond CZ4YT=RR +36 basis points to +137bps over bmk*
8-yr T-bond CZ8YT=RR -2 basis points to +115bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR +1 basis points to +370bps over bmk*
5-yr T-bond PL5YT=RR +2 basis points to +292bps over bmk*
10-yr T-bond PL10YT=RR -2 basis points to +236bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR +12 basis points to +960bps over bmk*
5-yr T-bond HU5YT=RR +13 basis points to +911bps over bmk*
10-yr T-bond HU10YT=RR +13 basis points to +710bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 0907 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
For related news and prices, click on the codes in brackets: All
emerging market news []
Spot FX rates Eastern Europe spot FX <EEFX=>
Middle East spot FX <MEFX=> Asia spot FX <ASIAFX=>
Latin America spot FX <LATAMFX=>
Other news and reports
World central bank news [] Economic Data Guide <ECONGUIDE>
Official rates [] Emerging Diary []
Top events [] Diaries [] Diaries Index []
(Reporting by Reuters bureaus, Writing by Dagmara
Leszkowicz; editing by Chris Pizzey)
