FX steady as Fed, Czech central bank in view

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WARSAW — Central European currencies

were little changed on Monday, shrugging off a jump in Polish

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inflation as markets looked ahead to interest-rate decisions in

the United States and the Czech Republic this week.

Polish flash CPI for October hit it’s highest point in more

than a quarter of a century on Monday at 17.9%, broadly in line

with expectations.

At 0936 GMT the zloty was little changed at

4.7170. Benchmark 10-year Polish bond yields were 10

basis points higher at 8.263%.

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Markets in Warsaw will be closed on Tuesday for a public

holiday. In Hungary, markets are closed on both Monday and

Tuesday. The forint was 0.12% weaker at 412 per euro.

“The volatility is really narrow, there are very few market

participants today, the inflation data is in line with consensus

so there is no new news to digest,” said a Warsaw-based currency

trader.

The Czech crown, tightly controlled by the central

bank, was 0.1% firmer at 24.491%.

“The hawkish offensive of the main (global) central banks

will continue with Wednesday’s Fed meeting,” CSOB said in a

note.

“Given that the Czech National Bank (CNB) will most likely

keep its main rate unchanged on Thursday, the positive rate

differential will narrow further. In our opinion, that will lead

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to stronger depreciation pressures on the crown.”

The U.S. Federal Reserve is expected to deliver another

75-basis-point rate hike after the conclusion of this week’s

policy-setting meeting on Wednesday, while the CNB is expected

to leave its main rate unchanged at 7.00%.

CEE SNAPSHO AT

MARKETS T 1036

CET

CURRENC

IES

Latest Previou Daily Change

s

bid close change in 2022

EURCZK Czech

EURHUF Hungary 0 0

EURPLN Polish

EURRON Romanian

EURHRK Croatian

EURRSD Serbian 0 0

Note: calculated from 1800

daily CET

change

Latest Previou Daily Change

s

close change in 2022

.PX Prague 1182.86 1184.14 -0.11% #VALUE!

00

.BUX Budapest 41053.7 41053.7 +0.00% -19.06%

1 1

.WIG20 Warsaw <.wig20>

.BETI Buchares 10938.1 10835.9 +0.94% -16.26%

t 3 2

.SBITO Ljubljan <.sbito p a>

.CRBEX Zagreb <.crbex>

.BELEX Belgrade <.belex>

.SOFIX Sofia <.sofix>

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

FORWARD

3×6 6×9 9×12 3M

interba

nk

Czech

Hungary

Poland

Note: are for ask

FRA prices

quotes

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(Reporting by Alan Charlish in Warsaw and Jason Hovet in

Prague; Editing by Kirsten Donovan)