WARSAW, Sept 15 (Reuters) - Central and Eastern European
currencies were largely unchanged early on Tuesday, with the
zloty awaiting August inflation data and the Czech crown likely
under pressure from August producer prices.
The zloty <EURPLN=>, which recovered after sharp losses in
early trade on Monday, was temporarily helped by the upward
revision of the country's growth forecast by the European
Commission but the gloomier sentiment, also reflected by stocks
in the red, is set to return on Tuesday.
The zloty was up 0.1 percent against the euro at 0650 GMT.
"We believe that the zloty was supported by rising US
stocks. The zloty's correction could, however, be a short break
before further weakening," BRE wrote.
Investors are particularly concerned by high dividend
payouts to foreign investors, which helped to push Poland's
current account into an unexpected deficit in July. Further
dividends are expected.
Czech August PPI unexpectedly edged up 0.2 percent from July
but showed the annual declined deepened, the biggest
year-on-year decline since records started in 1991.
The crown <EURCZK=> was little changed after the data.
In politics, the lower house was due to meet on its own
dissolution, which should allow for an early election in Nov.
The plan to hold elections however could still be challenged in
courts, raising uncertainty over the election itself, as well as
plans to approve the 2010 budget and savings measures required
to hold the ballooning budget deficit in check.
"The crown will continue to be dragged by the region and the
development of the risk aversion, which could be influenced by
U.S. retail sales or the German ZEW," Komernci Banka said in a
report.
The forint <EURHUF=> reversed some of its gains posted late
in Monday's session and eased to levels around 273.50 to the
euro early on Tuesday, but a trader said it was unlikely to ease
substantially, predicting a range of 272.5/275 per euro.
Another dealer said industrial output data scheduled for
Tuesday could have some impact on the market, but unless there
is major news coming from global markets, the forint was
expected to remain in its recent range throughout the session.
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 25.487 25.454 -0.13% +4.97%
Polish zloty <EURPLN=> 4.184 4.188 +0.1% -1.65%
Hungarian forint <EURHUF=> 273.07 273.27 +0.07% -3.49%
Croatian kuna <EURHRK=> 7.329 7.326 -0.04% +0.49%
Romanian leu <EURRON=> 4.273 4.268 -0.12% -6.05%
Serbian dinar <EURRSD=> 93.439 93.432 -0.01% -4.24%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
3-yr T-bond CZ3YT=RR +3 basis points to 194bps over bmk*
7-yr T-bond CZ7YT=RR +1 basis points to +184bps over bmk*
10-yr T-bond CZ10YT=RR -2 basis points to +179bps over
bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR 0 basis points to +389bps over bmk*
5-yr T-bond PL5YT=RR -1 basis points to +341bps over bmk*
10-yr T-bond PL10YT=RR -1 basis points to +289bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR +3 basis points to +648bps over bmk*
5-yr T-bond HU5YT=RR -1 basis points to +583bps over bmk*
10-yr T-bond HU10YT=RR -2 basis points to +497bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 0849 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
(Reporting by Reuters bureaus, writing by Karolina Slowikowska;
editing by Chris Pizzey)
