PRAGUE, Aug 3 (Reuters) - The Polish zloty edged higher on
Monday on the back of a record rise in PMI as central European
currencies extended recent gains on investors' return to risk.
The zloty <EURPLN=> added 0.1 percent to bid at 4.136 to the
euro by 0740 GMT, while the Czech crown <EURCZK=> gained 0.15
percent.
Poland's purchasing managers' index rose at a record pace in
July to its highest in more than a year, but stuck below the
breakeven 50 level dividing contraction from growth.
[]
The Czech PMI inched up to a 10-month high in July,
following an improvement in industrial output figures in a fresh
sign the economy may be nearing the bottom. []
"We had a few months of a wait-and-see attitude and now
sentiment is improving," Piotr Bieleski, senior economist at
Bank Zachodni WBK, said on the Polish PMI release.
"This is a good indication of what data we may expect this
month, that industrial output in July could have been not so
bad."
Stocks also extended their winning run, with gains of more
than 0.5 percent on Monday.
Investors have started taking stock of central Europe's
beaten-down economies, with the first signs of a bottom coming
to light in the past few months.
Analysts expect the Polish economy, which has avoided the
contraction of its regional peers, to be among the first to
return to moderate growth, along with the Czech economy.
Czech industry cut its fall to 12.3 percent in June from
over 20 percent helped by improving indicators in its main trade
partner Germany, early data showed on Friday.
The Hungarian forint <EURHUF=>, trading at a more than
six-month high, tested the key 265 per euro level, while the
Romanian leu <EURRON=> was steady around 4.21 per euro.
"For the time being there is room (for further gains), the
other (regional currencies) are also firming, but it's quite
early and I would not expect us to firm past 265 in a sustained
way," a Budapest-based currency dealer said.
The zloty, crown and forint ended July with a second
consecutive monthly gain as signs of recovery in the global
economy boosted investors' appetite.
Dealers and strategists have said the gains still have room
to run out, but many have warned the moves have gone past
economic fundamentals as the central Europe countries, among the
hardest hit in the downturn, struggle with still rising
unemployment and ballooning deficits.
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 25.552 25.59 +0.15% +4.7%
Polish zloty <EURPLN=> 4.136 4.14 +0.1% -0.51%
Hungarian forint <EURHUF=> 266.25 266.6 +0.13% -1.01%
Croatian kuna <EURHRK=> 7.351 7.352 +0.01% +0.19%
Romanian leu <EURRON=> 4.207 4.21 +0.07% -4.58%
Serbian dinar <EURRSD=> 92.8 92.997 +0.21% -3.58%
All data taken from Reuters at 0943 CET.
Currency percent change calculated from the daily domestic
close at 1500 GMT.
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(Reporting by Reuters bureaus, writing by Jason Hovet, editing
by Stephen Nisbet)
