ECO MARKETS – Forint and zloty drop to record lows as global selloff weighs

PRAGUE, March 7 (Reuters) – The Hungarian forint and Polish zloty weakened to record lows as banks slumped to drag the sector on Monday, following signals from global markets as investors maintained a cautious stance with Western countries considering a ban on import Russian oil.

Central Europe has been hit hard by the flight to safer assets following Russia’s invasion of Ukraine, with concerns heightened over the stagflationary effects of the crisis.

The Czech central bank said last week that it was intervening in the markets against excessive fluctuations and depreciation of the krone. He did not comment on Monday whether he was active in the markets.

The crown EURCZK= was down 0.8% on the day at 25.854 per euro, falling less than its Central European peers.

The forint led the losses among Central European markets and hit all-time lows of 400 to the euro. As of 09:09 GMT, it was down 3.4% at 399.0 per euro.

Last week the forint posted its biggest weekly loss and is down more than 8% since February 24, the start of the Russian invasion, which Moscow says is a “special military operation”.

“I could say I’ve never seen anything like it,” said a Budapest-based trader on the forint. “I was trading during the 2008 (global financial) crisis, and the uncertainty was high at the time, but it wasn’t a war.”

Hungary’s government bond market was virtually at a standstill, two fixed-income traders in Budapest said.

“We are about 30 basis points higher than Friday’s close on the long end of the curve,” one said. “But no customers are calling, nothing is happening, everyone is sitting and watching the forint and waiting for the central bank to do something.”

Hungary’s central bank was not immediately available to comment on market moves on Monday.

The Polish zloty fell 2.25% to 4.9615 per euro, just after a record low of 4.9625 reached during the session. Last week, the Polish central bank also sold foreign currencies against zlotys to support the currency.

Polish banking stocks sent the Warsaw index down 1.5% as the stock market’s banking index fell more than 7% .BNKI. Financial stocks in the region were also under pressure, and Budapest .BUX and Prague .PX fell 6.25% and 5.7%, respectively.

CEE MARKETS

INSTANTANEOUS

At 1009 CET

CURRENCIES

Last

Previous

Daily

Change

bid

Close

change

in 2022

EURCZK=

Czech koruna

EURCZK=

25.8540

25.6580

-0.76%

-3.80%

EURHUF=

Hungarian forint

EURHUF=

399.0000

385.6300

-3.35%

-7.42%

EURPLN=

polish zloty

EURPLN=

4.9615

4.8501

-2.25%

-7.47%

EURRON=

lei in Romanian

EURRON=

4.9495

4.9500

+0.01%

-0.03%

EURHRK=

Croatian kuna

EURHRK=

7.5570

7.5585

+0.02%

-0.52%

EURRSD=

Serbian dinar

EURRSD=

117.5500

117.6500

+0.09%

+0.03%

Note: daily change

calculated from

1800 CET

INVENTORY

Last

Previous

Daily

Change

Close

change

in 2022

.PX

prague

.PX

1231.34

1306.1400

-5.73%

#ASSESS!

.BUX

Budapest

.BUX

38892.97

40246.70

-3.36%

-23.32%

.WIG20

Warsaw

.WIG20

1889.76

1918.75

-1.51%

-16.64%

.BETI

Bucharest

.BETI

10683.88

11395.60

-6.25%

-18.20%

.SBITOP

Ljubljana

.SBITOP

1075.39

1121.24

-4.09%

-14.34%

.CRBEX

Zagreb

.CRBEX

1883.24

1946.54

-3.25%

-9.43%

.BELEX15

Belgrade

.BELEX15

829.18

829.71

-0.06%

+1.02%

.SOFIX

Sofia

.SOFIX

544.92

574.42

-5.14%

-14.28%

OBLIGATIONS

Yield

Yield

propagated

Daily

(bid)

change

vs. Bunds

change

Czech Republic

spread

CZ2YT=RR

2 years

CZ2YT=RR

4.3540

0.0000

+513 basis points

-1bps

CZ5YT=RR

5 years

CZ5YT=RR

3.6680

0.1270

+406 basis points

+11 basis points

CZ10YT=RR

10 years

CZ10YT=RR

3.2310

0.0980

+331 basis points

+7 basis points

Poland

PL2YT=RR

2 years

PL2YT=RR

4.5260

0.1930

+531 basis points

+18 basis points

PL5YT=RR

5 years

PL5YT=RR

4.5620

0.2530

+496 basis points

+24bps

PL10YT=RR

10 years

PL10YT=RR

4.3760

0.2310

+445bps

+21 basis points

ENG

3×6

6×9

9×12

3M interbank

Czech Republic

CZKFRAPRIBOUR=

4.96

4.96

4.72

4.77

Hungary

OYSTERBUBOR=

7.54

7.56

7.44

5.58

Poland

PLNFRAWIBOR=

5.48

5.52

5.49

3.78

Note: FRA quotations correspond to asking prices

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

(Reporting by Jason Hovet in Prague, Anita Komuves in Budapest and Alicja Ptak in Warsaw; Editing by Sherry Jacob-Phillips)

(([email protected]))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.