Polish zloty recovers as fears ease of escalation over missile hit
BUCHAREST — The Polish zloty recovered
on Wednesday as tensions eased over a missile which killed two
people in Poland the previous day near the NATO member’s border
The missile strike amplified concerns the war in Ukraine
sparked by Russia’s invasion could spill into neighboring
countries. First reports of the blast had pushed the zloty to
three-week lows in overnight trading.
But markets calmed after Poland and NATO said the missile
was probably not a Russian strike but a stray fired by Ukraine’s
The zloty sharply pared losses throughout
Wednesday and was down 0.2% on the day at 4.697 against the euro
by afternoon, off its overnight low of around 4.78.
Warsaw’s blue-chip index remained down over 1%.
Nicholas Farr, emerging Europe economist for Capital
Economics, said developments helped reverse losses and the
region’s risk premium, but risks still remained for currencies
that have been on the wrong side of market sentiment recently.
“The risk of military escalation in and around Ukraine
remains a key threat and is one that is likely to cause periodic
bouts of volatility in CEE financial markets given the region’s
exposure to the conflict,” he said.
U.S. President Joe Biden had earlier said publicly the
missile was “unlikely” to have been fired from Russia.
That began to alleviate concern that the first deadly
incident in a NATO country since the war in Ukraine began might
lead to escalation.
Investors were also watching a suspension of oil deliveries
to central and eastern Europe via a section of the Druzhba
pipeline that started on Tuesday.
Hungarian Foreign Minister Peter Szijjarto said shipments
had re-started on Wednesday afternoon.
Hungary’s MOL shares were down much of Wednesday but traded
flat by late afternoon. MOL had said on Tuesday its Ukrainian
partner told the company that a Russian rocket had hit a power
station which provides electricity for a pump station.
Indices in Budapest and Prague were down 0.1%
and 0.6% respectively, while Bucharest rose 0.5%.
Also in Hungary, the forint was down 0.5% on the
day while the Czech crown and the Romanian leu
were little changed.
The forint, which has lost more than 9% so far in 2022 to
make it the worst-performing currency in central Europe, traded
at 408.5 per euro, or 1.3% firmer than overnight lows.
CEE SNAPSHO AT
MARKETS T 1559
Latest Previou Daily Change
bid close change in 2022
Note: calcula 1800
daily ted CET
Latest Previou Daily Change
close change in 2022
.PX Prague 1239.63 1246.81 -0.58% #VALUE!
.BUX Budapest 44289.0 44308.2 -0.04% -12.68%
.WIG20 Warsaw <.wig20>
.BETI Buchares 11714.6 11656.5 +0.50% -10.31%
t 2 3
.SBITO Ljubljan <.sbito p a>
.CRBEX Zagreb <.crbex>
.BELEX Belgrade <.belex>
.SOFIX Sofia <.sofix>
Yield Yield Spread Daily
(bid) change vs Bund change
3×6 6×9 9×12 3M
Note: are for
(Reporting by Luiza Ilie in Bucharest, Anita Komuves in
Budapest, Jason Hovet in Prague and Anna Wlodarczak-Semczuk in
Warsaw; Editing by Jason Hovet, Elaine Hardcastle and Alexander
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