Hungarian forint firms slightly after 100 bps cenbank rate hike

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BUDAPEST — The forint firmed after the

National Bank of Hungary delivered another rate hike on Tuesday

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as it was battling soaring inflation, fueled by a weak forint,

surging energy prices and rising wages in a tight labor market.

The forint was up 0.55% on the day and trading at

405.90 per euro, a touch stronger than levels seen before the

bank raised its base rate by 100 basis points to 11.75%, as

expected by a Reuters poll of analysts.

Markets were also eyeing the central bank’s press conference

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scheduled for 1300 GMT.

“The market got what it was waiting for, thus the decision

did not really move the (exchange) rate,” an FX trader in

Budapest said.

“If the bank says something major at the presser that could

move the forint a bit in either direction, but not

significantly. Energy prices are much more important for the

currency now than the central bank’s steps.”

The forint, central Europe’s worst performer so far this

year with its 9% loss versus the euro has recently been

pressured by soaring gas prices and a lack of agreement over

European Union funds.

Long-term government bond yields were stable immediately

after the NBH’s decision, a fixed-income trader in Budapest

said.

The yield on the 10-year bond was about 8.90%.

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Elsewhere, currencies were little moved. The Czech crown

was stable, while the Polish zloty edged

down 0.02% to 4.7330. The Romanian leu eased 0.05% to

4.8660 versus the common currency.

Most stocks in the region firmed, recouping some losses from

the previous session when they fell along with European peers as

investors were concerned by recession fears.

Prague’s stocks led gains with a 2.26% rise, while

Budapest was up 0.12%. Warsaw eased 0.19%, while

Bucharest’s equities added 0.35%.

CEE SNAPSH AT

MARKETS OT 1430

CET

CURREN

CIES

Latest Previo Daily Change

us

bid close change in

2022

EURCZK Czech 0 0 % %

EURHUF Hungary 00 00 %

EURPLN Polish

EURRON Romania %

EURHRK Croatia %

EURRSD Serbian 00 00 % %

Note: calculated from 1800

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daily CET

change

Latest Previo Daily Change

us

close change in

2022

.PX Prague 1190.8 1164.5 +2.26

5 700 %

.BUX Budapes 42684. 42631. +0.12 -15.84

t 75 81 % %

.WIG20 Warsaw <.wig20> 8 5 %

.BETI Buchare 12232. 12190. +0.35 -6.34%

st 69 46 %

.SBITO Ljublja <.sbito p na> 0 7 %

.CRBEX Zagreb <.crbex> 9 5

.BELEX Belgrad <.belex e> % %

.SOFIX Sofia <.sofix> %

Yield Yield Spread Daily

(bid) change vs change

Bund in

Czech spread

Republi

c

CZ2YT= 0 ps

CZ5YT= 0 ps

CZ10YT 0 ps

Poland

PL2YT= 0 ps

PL5YT= 0 ps

PL10YT 0 ps

FORWARD

3×6 6×9 9×12 3M

interb

ank

Czech

Hungary

Poland

Note: are for ask

FRA prices

quotes

****************************************

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(Additional reporting by Pawel Florkiewicz in Warsaw; Editing

by Subhranshu Sahu and Shailesh Kuber)