LONDON, March 30 South Africa's rand recouped some losses on Thursday from a three-day dive as the future of the country's finance minister remained uncertain, while Czech crown watchers were waiting for signals on when its peg to the euro might be removed.
The saga over whether South African President Jacob Zuma would sack investor favourite Pravin Gordhan took a fresh twist as the country's opposition party said it had rejected plans for a cabinet reshuffle that would have removed the finance minister .
The rand had already bounced having lost more than four percent since the start of the week and stood almost 1 percent higher on the day before a central bank meeting that is expected to leave interest rates unchanged.
"Realistically all of us in the market are waiting to see how things play out with the finance minister," said Yacov Arnopolin, a portfolio manager focusing on emerging markets at PIMCO. "If he is removed that would not be viewed positively by the market."
Shares and bonds in Halkbank, Turkey's fifth largest bank by assets, also steadied having slumped the previous day when U.S. prosecutors charged one of its senior executives with participating in a multi-year scheme to violate sanctions against Iran.
The bank had been preparing for a bond sale but that now looks likely to be put on hold.
"At the moment it (scandal) seems contained but you never know how these things turn," said Aberdeen Asset Management's head of EM corporate debt Siddharth Dahiya.
Halkbank's woes did not, however, deter the Turkish Treasury from marketing a sovereign sukuk.
In central Europe, the Czech central bank was holding its final meeting before the expiration of its 3-1/2-year old pledge to keep the crown at a level no stronger than 27 per euro.
The crown's implied euro exchange rate was near multi-month highs in forwards contracts.
The Czech government sold twice as many bonds as planned at an auction on Wednesday, seeking to benefit from low yields before the cap is scrapped.
Most analysts expect the move in April or May with inflation now back at the CNB's 2 percent target and FX reserves triple what they were before the cap's introduction in 2013.
Away from the various flash points, emerging market stocks drifted away from two-year highs and most emerging currencies edged lower following talk of as many as three more U.S. rate hikes from Federal Reserve officials.
Ukraine bonds nudged slightly higher as hopes the IMF will provide another instalment of its aid helped soothe the pain of a loss to Russia in the first round of court battle over $3 billion Moscow lent to Kiev in late 2013 .
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see) Emerging Markets Prices from Reuters Equities Latest Net Chg % Chg % Chg
Morgan Stanley Emrg Mkt Indx 969.26 -2.60 -0.27 +12.41
Czech Rep 983.29 +0.58 +0.06 +6.69
Poland 2203.99 -10.46 -0.47 +13.15
Hungary 31979.51 -253.44 -0.79 -0.07
Romania 7982.88 +40.12 +0.51 +12.67
Greece 673.50 +4.95 +0.74 +4.64
Russia 1129.92 +5.01 +0.45 -1.94
South Africa 45234.41 -170.28 -0.38 +3.03
Turkey 89456.09 +186.37 +0.21 +14.48
China 3208.93 -32.39 -1.00 +3.39
India 29617.06 +85.63 +0.29 +11.23
Currencies Latest Prev Local Local
close currency currency
% change % change
Czech Rep 27.02 27.03 +0.05 -0.04
Poland 4.23 4.22 -0.07 +4.19
Hungary 309.77 309.44 -0.11 -0.31
Romania 4.54 4.55 +0.23 -0.16
Serbia 123.85 123.82 -0.02 -0.40
Russia 56.36 56.57 +0.37 +8.70
Kazakhstan 314.81 315.56 +0.24 +5.98
Ukraine 27.01 27.01 -0.00 -0.02
South Africa 12.94 13.04 +0.73 +6.11
Kenya 102.90 103.00 +0.10 -0.52
Israel 3.62 3.62 -0.02 +6.49
Turkey 3.64 3.64 +0.03 -3.20
China 6.89 6.89 -0.03 +0.77
India 64.93 64.85 -0.12 +4.65
Brazil 3.12 3.12 -0.10 +4.19
Mexico 18.70 18.70 +0.03 +10.79
Debt Index Strip Spd Chg %Rtn Index
Sov'gn Debt EMBIG 328 0 .06 7 70.45 1
All data taken from Reuters at 09:32 GMT. Currency percent change calculated from the daily U.S. close at 2130 GMT.
(Reporting by Marc Jones; Editing by Toby Davis)
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