Zloty off overnight lows after Polish explosion, stocks fall

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BUCHAREST — The Polish zloty traded

down around half a percent on Wednesday, but had pulled back

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from overnight lows with other central European currencies,

after a deadly explosion in NATO member Poland near its border

with Ukraine on Tuesday.

The missile strike in eastern Poland that killed two people

has amplified concerns the war Russia started in Ukraine will

spill into neighboring countries.

The missile that killed two people in Poland was probably

not fired from Russia, U.S. President Joe Biden said early on

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Wednesday.

By 0810 GMT, the Polish zloty was down 0.5% on the

day at 4.7075 per euro. Warsaw’s blue-chip index was

down 0.7% on the day after opening 1.5% lower.

“Today’s session on the domestic financial market will be

dominated by geopolitical events,” Bank Millennium said, adding

volatility was likely.

The bank noted the zloty’s first reaction was relatively

calm but that “further changes will depend on the reaction of

NATO countries to this incident.”

NATO ambassadors will hold an emergency meeting on

Wednesday.

Elsewhere in the region, the Hungarian forint and

Czech crown were flat, while the Romanian leu

was down 0.2%.

The forint fell as far as 413.80 per euro on Tuesday, but

was trading at 406.50 on Wednesday, nearly 2% higher than lows

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touched after initial reports of explosions in Poland.

The explosion near the Ukrainian border came as Russia

unleashed a wave of missiles targeting Ukrainian energy

infrastructure.

Oil supplies via the Druzhba pipeline to Europe were

interrupted on Tuesday, raising nervousness among investors.

Budapest and Prague were down 0.6% and 0.1%

respectively, while Bucharest, which is more illiquid,

rose 0.7%.

CEE SNAPSHO AT

MARKETS T 0932

CET

CURRENC

IES

Latest Previou Daily Change

s

bid close change in 2022

Czech

Hungary 0 0

Polish

Romanian

Croatian

Serbian 0 0

Note: calculated from 1800

daily CET

change

Latest Previou Daily Change

s

close change in 2022

Prague 1246.36 1246.81 -0.04% #VALUE!

00

Budapest 44036.4 44308.2 -0.61% -13.18%

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4 9

Warsaw 1752.03 1769.55 -0.99% -22.71%

Buchares 11717.7 11656.5 +0.52% -10.29%

t 1 3

Ljubljan <.sbitop a>

Zagreb 1906.15 1907.00 -0.04% -8.33%

Belgrade <.belex1>

Sofia 595.47 595.14 +0.06% -6.33%

Yield Yield Spread Daily

(bid) change vs Bund change

in

Czech spread

Republic

2-year s

5-year s

s

Poland

2-year s

5-year s

s

FORWARD

3×6 6×9 9×12 3M

interba

nk

Czech 7.16 6.93 6.62 7.26

Rep

Hungary 13.80 13.19 12.38 15.62

Poland 7.28 7.27 7.04 7.42

Note: are for ask

FRA prices

quotes

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(Reporting by Luiza Ilie in Bucharest, Anita Komuves in

Budapest, Jason Hovet in Prague and Anna Wlodarczak-Semczuk in

Warsaw; Editing by Jason Hovet and Elaine Hardcastle)