CEE MARKETS-Crown pares losses after sharp fall as FX steady, stocks drop

Reuters
·3 min read

PRAGUE, Feb 26 (Reuters) - The Czech crown recovered some losses against the euro on Friday, after its biggest two-day slide since October, as a worsening pandemic situation in the country and around central Europe kept currencies under pressure. Hungary's forint edged up but was near a seven-week low hit on Thursday. Stocks also slipped around the region, led by a 1.4% fall in Warsaw, following global peers as a rout in bond markets spooked investors. Central European bond yields slightly ticked up. The long-end end of the curve has largely copied global developments. The crown had gained 0.2% at 26.16 to the euro by 1021 GMT. The currency rallied much of February on expectations that the Czech central bank could begin raising interest rates later this year, but it lost as much as 1.5% on Wednesday and Thursday as the government signalled a stricter lockdown was coming. Czech Prime Minister Andrej Babis said on Thursday that people's movement needed to be "radically" limited over at least the next three weeks to slow one of the world's fastest spreads of COVID-19 infections. His minority government was seeking an extension of state-of-emergency powers in parliament on Friday. Dealers said the pandemic situation would keep the crown weak. Elsewhere in central Europe, Poland was set to roll back loosened restrictions in one region, and Hungarian Prime Minister Viktor Orban said his country could consider tightening some restrictions as infections were expected to rise "drastically" in the next two weeks. The government this week extended a partial lockdown until March 15. The forint was flat at 361.05 per euro, while the Polish zloty also steadied at 4.517. "The euro/forint rate crossed the 361.50 level, the next resistance is at 363.15, then at 365," brokerage Equilor said. CEE SNAPSHO AT MARKETS T 1121 CET CURRENC IES Latest Previou Daily Change s bid close change in 2021 EURCZK Czech EURHUF Hungary 0 0 EURPLN Polish EURRON Romanian EURHRK Croatian EURRSD Serbian 0 0 Note: calculated from 1800 daily CET change STOCKS Latest Previou Daily Change s close change in 2021 .PX Prague 1058.15 1067.84 -0.91% +3.02% 00 .BUX Budapest 44031.2 43999.4 +0.07% +4.57% 1 7 .WIG20 Warsaw <.WIG20 1909.61 1936.47 -1.39% -3.75% > .BETI Buchares 10250.9 10279.8 -0.28% +4.54% t 5 2 .SBITO Ljubljan <.SBITO 966.40 969.17 -0.29% +7.28% P a P> .CRBEX Zagreb <.CRBEX 1836.85 1839.11 -0.12% +5.61% > .BELEX Belgrade <.BELEX 748.75 752.49 -0.50% +0.02% 15 15> .SOFIX Sofia <.SOFIX 496.75 497.92 -0.23% +11.00 > % BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic CZ2YT= 2-year s CZ5YT= 5-year s CZ10YT s Poland PL2YT= 2-year s PL5YT= 5-year s PL10YT s FRA 3x6 6x9 9x12 3M interba nk Czech Hungary Poland Note: FRA quotes are for ask prices ******************************************** ****************** (Reporting by Jason Hovet in Prague and Anita Komuves in Budapest; Editing by Amy Caren Daniel)