Czech crown set to lead CEE currencies, forint held back
reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/fx-polls?RIC=EURCZK= euro/koruna poll data
reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/fx-polls?RIC=EURPLN= euro/zloty poll data
reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/fx-polls?RIC=EURHUF= euro/forint poll data
reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/fx-polls?RIC=EURRON= euro/leu poll data
reuters://realtime/verb=Open/url=cpurl://apps.cp./Apps/fx-polls?RIC=EURRSD= euro/Serbian dinar poll data
By Jason Hovet
PRAGUE, Sept 5 (Reuters) -The Czech crown should lead gains among central Europe's main currencies in the coming year as the economy recovers and interest rate cuts slow, a Reuters poll showed on Thursday, while Hungary's forint is seen languishing at current levels.
Central Europe's currencies have tracked higher in the past month as central banks either slow or pause interest rate cuts or keep policy on hold in Poland's case.
But their fortunes are seen diverging in the months ahead, the poll showed, with analysts tipping the crown and Polish zloty to gain while the forint and Romania leu will struggle for traction.
In the poll, the median forecast saw the crown EURCZK= rising 2.2% from Tuesday's closing levels in the next 12 months, to reach 24.584 to the euro.
"Fundamentally, Czech (economic) growth should strengthen while the balance of payments' current account should maintain a surplus," said Radomir Jac, chief economist at Generali Investments CEE.
He said that while the U.S. Federal Reserve and European Central Bank (ECB) were likely to be cutting interest rates, the Czech National (CNB) was shifting toward fine-tuning.
"We expect the global monetary policy shifts to support gains of the euro against the U.S. dollar and such EUR/USD exchange rate development should be positive for the Czech crown as well as for other CEE currencies."
The CNB slowed its policy-easing drive on Aug. 1 with a 25-basis-point interest rate cut, saying it would be cautious with its next steps. The crown has recovered to near the psychological 25 per euro level since that meeting after trading weaker than 25.50.
In Poland, the central bank (NBP) has been on hold since last year while the Polish economy has been the region's top performer in the first half of the year.
The zloty EURPLN=, meanwhile, is trading in tight ranges, less than 1% off a four-year high around 4.25 to the euro. The median forecast saw the zloty returning to that level within six months before hovering in that space.
"In the near term we deem it likely that (its) range will maintain," Danske Bank said.
"In the slightly longer run however, we now see some potential (strengthening)... driven by the aforementioned Polish growth outperformance and NBP's tight policy stance."
The forint EURHUF= and leu EURRON= are seen struggling to gain in the coming months.
Hungary's currency has rebounded since hitting a 2024 low around the 400 per euro level last month, but has levelled off in recent weeks. The poll forecast a 0.3% fall over the next 12 months to 395.50.
The leu was expected to weaken 0.9% to 5.02 to the euro in that time.
(Other stories from the September Reuters foreign exchange poll)
Reporting by Jason Hovet; Polling by Pranoy Krishna, Purujit Arun and Rahul Trivedi
Editing by Tomasz Janowski
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
