* Zloty pressured by doubts over rate hike, Japan crisis
* Polish bond yields fall as wage data come below forecasts
* Hungarian bond prices gain, forint, crown little changed
(Updates, adds new comments)
By Krisztina Than and Marcin Goettig
BUDAPEST/WARSAW, March 16 (Reuters) - The Polish zloty hit a
new 3-1/2-month low on Wednesday versus the euro as Japan's
nuclear crisis fuelld risk aversion and Polish bond yields also
fell after data cast fresh doubts over an April rate rise.
Other currencies in the region were largely flat.
"We still see upside risks to EUR/PLN short-term and believe
we can see 4.10 very soon," said Nordea FX analyst Elisabeth
Andreew, adding that the Japan crisis, North Africa unrest and
weaker Polish wage data may continue to weigh on the zloty.
"We also have the break of the psychological 4.00 level,
which I think can trigger some more stop-losses," she added.
Asian financial markets rebounded on Wednesday after deep
falls but stocks across Europe came under fresh pressure after
Europe's energy chief warned of a further catastrophe at Japan's
stricken nuclear site. []
Poland's corporate wages grew more slowly than forecast in
February and, coming after Tuesday's surprisingly low inflation
figures, further underscored the case for flat rates in April
despite earlier expectations for a hike. []
[]
Bond yields in Poland fell up to 7 basis points on the
short-end of the curve on Wednesday as the chances of a rate
rise in April fell to around 30 percent from 50 percent at the
beginning of the week.
Poland managed to sell CPI-linked and floating rate bonds
worth only 1 billion zloty from the 1-2.5 billion offer.
[]
By 1520 GMT the zloty <EURPLN=D2> was down 0.5 percent from
Tuesday's close versus the euro, while the forint <EURHUF=> and
Czech crown <EURCZK=> were little changed.
HUNGARIAN BONDS STRONGER
Dealers said the crown may draw some support from stronger
than expected retail sales data. []
Yields fell also in Hungary where domestic markets reopened
after national holidays on Monday and Tuesday.
Hungary sold 50 billion forints worth of 3-month treasury
bills at an auction that attracted good demand. <HUAUCTION01>
Traders said foreign investors were buying Hungarian bonds,
confounding local expectations for price falls.
"I don't see big momentum in the yield falls, there are also
some negative (international) factors," one Budapest-based fixed
income trader said.
An apparent easing of inflation worries there helped
Hungarian yields edge lower, a fixed income trader in Budapest
said.
"Crude prices have retreated, the Fed issued dovish comments
and will certainly not increase interest rates," he said.
"(European Central Bank rate setter Christian) Noyer's
comments (on the Japanese crisis) show that the ECB might also
rethink its earlier signal for a rate hike, while Germany's
latest economic sentiment indicator was worse than expected. As
a result of all this, core market debt yields have fallen."
Analysts said Noyer's comments had not significantly diluted
expectations of an ECB rate hike in April. []
Hungarian markets will be looking for news from a government
roadshow starting this week in Europe and the United States and
expected to lead to an issue of a new dollar benchmark bond.
[]
Romania's leu <EURRON=> was flat ahead of a parliamentary
vote of no-confidence against the coalition government's
IMF-mandated reforms, which is widely expected to fail.
[] The vote is expected at about 1700 GMT.
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2011
Czech crown <EURCZK=> 24.393 24.382 -0.05% +2.49%
Polish zloty <EURPLN=> 4.074 4.05 -0.54% -2.85%
Hungarian forint <EURHUF=> 273.83 273.89 +0.02% +1.52%
Croatian kuna <EURHRK=> 7.355 7.382 +0.37% +0.34%
Romanian leu <EURRON=> 4.177 4.17 -0.02% +1.34%
Serbian dinar <EURRSD=> 102.57 102.58 +0.01% +3.27%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond CZ2YT=RR +5 basis points to 23bps over bmk*
7-yr T-bond CZ7YT=RR +7 basis points to +76bps over bmk*
10-yr T-bond CZ9YT=RR +8 basis points to +77bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -5 basis points to +347bps over bmk*
5-yr T-bond PL5YT=RR -5 basis points to +339bps over bmk*
10-yr T-bond PL10YT=RR +1 basis points to +314bps over bmk*
The P
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR -6 basis points to +501bps over bmk*
5-yr T-bond HU5YT=RR -4 basis points to +492bps over bmk*
10-yr T-bond HU10YT=RR -6 basis points to +429bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1620 CET.
Currency percent change calculated from the daily domestic
close at 1700 GMT.
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(Reporting by Reuters bureaus; Writing by Marcin Goettig;
editing by Toby Chopra)
