Zloty edges lower ahead of Polish interest rates decision
WARSAW, Sept 4 (Reuters) -The Polish zloty eased a touch on Wednesday ahead of the central bank's interest rate decision later in the day, with analysts expecting stable borrowing costs amid rebounding inflation.
All 29 respondents in a Reuters poll forecast no change in the National Bank of Poland's monetary policy, meaning the cost of credit will have remained unchanged since October.
By 1020 GMT the zloty EURPLN= eased 0.1% against the euro to 4.2820, near the mid point of the firm range it has stayed in since August.
The Polish currency remains Central Eastern Europe's top performer, gaining almost 1.5% this year, supported by steady interest rates and unblocked funds from the European Union.
Analysts will closely scrutinise the Monetary Policy Council's (MPC) press release following the rate decision and on Thursday's conference by the NBP governor for signs of when rate changes could resume.
"On the one hand, in August, Governor (Adam) Glapinski joined those MPC members who see room for interest rate cuts in 2025, which may translate into a softening of the official stance of the entire Council," ING BSK said in a note.
"On the other hand, solid GDP data in 2Q24, including investment growth and further inflation growth in August, and a higher than previously planned fiscal imbalance in 2024-25 speak in favor of maintaining a hawkish stance."
In August Glapinski said Polish policymakers could discuss changing monetary policy before 2026, softening his previous, more hawkish outlook.
Data last week showed Poland's economic growth picking up pace in the second quarter, reaching is fastest year-on-year rate in almost two years on the back of private consumption and fast wage growth.
Also last week, Poland's draft budget for 2025 forecast the country's general deficit rising to 5.5% of GDP next year.
In Hungary, the forint EURHUF= firmed 0.2% against the euro on Wednesday to 393.30, halting its losses after it weakened about half a percent in the previous session.
"A risk-averse mood appeared in markets yesterday, which pushed the dollar stronger, ... This mood could continue today, so I do not expect any big firming in the forint. It might as well weaken a bit, as far as 394.50," a currency trader in Budapest said.
Meanwhile, the Czech crown EURCZK= edged up 0.1% to 25.0770 per euro, hovering off of the two-month highs it hit in August.
CEE MARKETS | SNAPSHOT | AT 1220 CET | |||
CURRENCIES | |||||
Latest | Previous | Daily | Change | ||
trade | close | change | in 2024 | ||
Czech crown | EURCZK= | 25.0770 | 25.1010 | +0.10% | -1.50% |
Hungary forint | EURHUF= | 393.3000 | 394.1500 | +0.22% | -2.57% |
Polish zloty | EURPLN= | 4.2820 | 4.2785 | -0.08% | +1.46% |
Romanian leu | EURRON= | 4.9730 | 4.9737 | +0.01% | +0.03% |
Serbian dinar | EURRSD= | 116.9700 | 117.0200 | +0.04% | +0.24% |
Note: daily change | calculated from | 1800 CET | |||
Latest | Previous | Daily | Change | ||
close | change | in 2024 | |||
Prague | .PX | 1584.51 | 1591.3200 | -0.43% | +12.06% |
Budapest | .BUX | 72438.79 | 72982.36 | -0.74% | +19.50% |
Warsaw | .WIG20 | 2395.41 | 2409.50 | -0.58% | +2.24% |
Bucharest | .BETI | 18020.21 | 18111.09 | -0.50% | +17.23% |
Spread | Daily | ||||
vs Bund | change in | ||||
Czech Republic | spread | ||||
2-year | CZ2YT=RR | 3.3450 | -0.0460 | +101bps | +0bps |
5-year | CZ5YT=RR | 3.5560 | -0.0560 | +143bps | -1bps |
10-year | CZ10YT=RR | 3.8080 | -0.0490 | +158bps | -1bps |
Poland | |||||
2-year | PL2YT=RR | 4.7330 | -0.0670 | +240bps | -2bps |
5-year | PL5YT=RR | 5.1320 | -0.0650 | +301bps | -2bps |
10-year | PL10YT=RR | 5.3590 | -0.0820 | +313bps | -4bps |
FORWARD | |||||
3x6 | 6x9 | 9x12 | 3M interbank | ||
Czech Rep | CZKFRAPRIBOR= | 3.92 | 3.61 | 3.35 | 4.36 |
Hungary | HUFFRABUBOR= | 6.60 | 5.75 | 5.33 | 6.50 |
Poland | PLNFRAWIBOR= | 5.75 | 5.42 | 4.98 | 5.87 |
Note: FRA quotes | are for ask prices | ||||
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Reporting by Karol Badohal in Warsaw and Anita Komuves in Budapest; Editing by Angus MacSwan
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