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CEE MARKETS-FX firms as market eyes Czech rate hike

    WARSAW, June 23 (Reuters) - Central European currencies were
firmer on Wednesday, ahead of a Czech central bank meeting that
economists expect will deliver the second rate hike in the
region in as many days.
    Central and eastern Europe has the highest inflation in the
European Union, and on Tuesday the Hungarian central bank became
the first in the bloc to launch a cycle of rate hikes to combat
growing price pressures in the aftermath of the COVID-19
pandemic.
    It raised its base rate to 0.9% from 0.6%, a slightly bigger
hike than analysts had expected, and said it would review the
need for more hikes on a monthly basis.
    Markets expect the Czech central bank will
follow suit with its first rate hike since just before the
pandemic started.    
    The Czech crown was 0.25% firmer against the euro at 25.454
at 0844 GMT, close to its two-week moving average. It hit
15-month highs on the strong side of 25.30 earlier in June.
    Commerzbank said a rate hike was likely, with the majority
on the Czech National Bank (CNB) board not wanting to wait and
that the crown had further room to gain over its forecast
horizon.
    "Consumer prices are close to the top end of the CNB target
range, core rate remains above it and producer price momentum
points towards increased price pressure," it said.
    The Hungarian forint was the best performing
currency in the region, firming 0.49% to 349.40 after Tuesday's
rate hike.
    "The central bank surprised to the hawkish side by saying
that it will deliver further hikes on a monthly basis ...
Moreover, the statement had a clear hawkish shift in tone as far
as inflation risks are concerned," Morgan Stanley said in a
note.
    In Poland, where the central bank has struck a much more
dovish tone than its Czech and Hungarian counterparts, the zloty
was 0.09% firmer at 4.518.


                   CEE       SNAPSHO   AT                       
                   MARKETS   T        1044 CET           
                             CURRENC                            
                             IES                         
                             Latest   Previous  Daily    Change
                             bid      close     change   in 2021
 EURCZK=  Czech    <EURCZK=  25.4540   25.5170   +0.25%   +3.04%
          crown    >                                     
 EURHUF=  Hungary  <EURHUF=  349.400  351.1000   +0.49%   +3.81%
          forint   >               0                     
 EURPLN=  Polish   <EURPLN=   4.5180    4.5220   +0.09%   +0.91%
          zloty    >                                     
 EURRON=  Romania  <EURRON=   4.9259    4.9264   +0.01%   -1.24%
          n leu    >                                     
 EURHRK=  Croatia  <EURHRK=   7.4970    7.4995   +0.03%   +0.67%
          n kuna   >                                     
 EURRSD=  Serbian  <EURRSD=  117.510  117.5600   +0.04%   +0.05%
          dinar    >               0                     
          Note:    calculated from              1800            
          daily                                 CET      
          change Latest   Previous  Daily    Change
                                      close     change   in 2021
 .PX      Prague             1164.97  1163.140   +0.16%   +13.42
                                             0                 %
 .BUX     Budapes            48391.9  48193.16   +0.41%   +14.92
          t                        1                           %
 .WIG20   Warsaw             2220.49   2220.53   -0.00%   +11.92
                                                               %
 .BETI    Buchare            11542.5  11409.11   +1.17%   +17.71
          st                       8                           %
 .SBITOP  Ljublja  <.SBITOP  1134.67   1131.36   +0.29%   +25.96
          na       >                                           %
 .CRBEX   Zagreb             1982.00   1981.15   +0.04%   +13.95
                                                               %
 .BELEX1  Belgrad  <.BELEX1   772.63    776.74   -0.53%   +3.21%
 5        e        5>                                    
 .SOFIX   Sofia               552.57    550.21   +0.43%   +23.47
                                                               %
                                                                
                             Yield    Yield     Spread   Daily
                             (bid)    change    vs Bund  change
                                                         in
          Czech                                          spread
          Republi                                        
          c                                              
 CZ2YT=R           <CZ2YT=R   0.3570   -0.0090   +101bp    -1bps
 R        2-year   R>                                 s  
 CZ5YT=R           <CZ5YT=R   1.6190    0.0070   +218bp    +1bps
 R        5-year   R>                                 s  
 CZ10YT=           <CZ10YT=   1.7690    0.0360   +194bp    +4bps
 RR       10-year  RR>                                s  
          Poland                                                
 PL2YT=R           <PL2YT=R   0.3760   -0.0240   +103bp    -2bps
 R        2-year   R>                                 s  
 PL5YT=R           <PL5YT=R   1.3400   -0.0360   +190bp    -3bps
 R        5-year   R>                                 s  
 PL10YT=           <PL10YT=   1.7960   -0.0100   +196bp    +0bps
 RR       10-year  RR>                                s  
                   FORWARD                                      
                             3x6      6x9       9x12     3M
                                                         interba
                                                         nk
          Czech                 0.83      1.11     1.40     0.44
          Rep      <PRIBOR=                              
                   >                                     
          Hungary               1.49      1.79     1.95     0.95
                                                         
          Poland                0.35      0.58     0.79     0.21
                                                         
          Note:    are for ask                                  
          FRA      prices                                
          quotes                                         
          *********************************************         
          *****************                              
 



 (Reporting by Alan Charlish in Warsaw, Jason Hovet in Prague
and Anita Komuves in Budapest; Editing by Giles Elgood)
 
 
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