May 5, 2020 / 9:50 AM / in 3 months

CEE MARKETS-FX, stocks gain on risk appetite; Hungary eyes bond purchases

    PRAGUE, May 5 (Reuters) - Central European currencies
climbed on Tuesday after risk appetite strengthened on some
global easing of lockdown measures, while Hungary's markets
steadied as the central bank launched its bond-buying scheme.
    Stock markets climbed between 0.5% and 1.6%, with Prague
 leading gains as several countries including Spain, Italy,
India and Malaysia tentatively eased lockdowns. 
    The Prague market was boosted by a more than 7% jump in
tobacco group Philip Morris CR after the Czech-based
company proposed paying a dividend from last year's profit that
amounted to an 11% yield against Monday's closing price. 
    Also helping were gains in shares of MONETA Money Bank
, up 2%, after the Czech lender reported first-quarter
earnings and said it would return to dividend payments as
quickly as possible.
    Investors were also eyeing Hungary, where the central bank
announced its first government bond purchase tender on Tuesday,
offering to buy three different government bonds from local
lenders, but did not specify the amount of bonds it would buy at
the inaugural tender. 
    The bank, which has said it could buy up to 100 billion
forints ($308.85 million) worth of bonds per week, has launched
the purchases to drive down longer-dated government debt yields
it considers too high. Yields were steady on Tuesday after
climbing slightly recently.    
    The Hungarian forint firmed 0.6% to 351.85 to the
euro and the Polish zloty was up a third of a percent
at 4.546 to the euro by 0841 GMT.
    The Czech crown gained 0.4% to straddle the
psychological 27 per euro level ahead of a central bank meeting
this week, where analysts expect the bank to cut rates for a
third time since the novel coronavirus outbreak started in
    The central bank, which cut rates by a total of 125 basis
points in March, is now expected to cut rates by 50 basis points
at the policy meeting on Thursday.
    The outbreak and measures by countries to fight the spread
have hammered central Europe economies, with analysts expecting
a plunge in gross domestic product after several years of solid
    Manufacturing surveys (PMI) across central Europe on Monday
showed a grim picture, although some analysts see a bottom being
reached as economies return to life.
    "We believe... April PMI will prove to be the very bottom as
restrictions are slowly but surely being lifted, and we should
therefore see some improvement in May already," Raiffeisen
commented on the Czech data.
    The Czech Republic is readying itself for a new phase of
reopening next week, while Slovakia is accelerating its
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1041              
                            Latest   Previou  Daily    Change
                            bid      close    change   in 2020
 EURCZK  Czech     <EURCZK  26.9800  27.1000   +0.44%   -5.74%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  351.850  354.060   +0.63%   -5.88%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.5460   4.5612   +0.33%   -6.37%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.8309   4.8301   -0.02%   -0.88%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.5745   7.5795   +0.07%   -1.70%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.580  117.580   +0.00%   -0.01%
 =       dinar     =>             0        0           
         Note:     calculated from            1800            
         daily                                CET      
                            Latest   Previou  Daily    Change
                                     close    change   in 2020
 .PX     Prague              877.14  862.950   +1.64%  -21.38%
 .BUX    Budapest           35028.2  34576.8   +1.31%  -23.99%
                                  4        4           
 .WIG20  Warsaw    <.WIG20  1609.16  1600.65   +0.53%  -25.16%
 .BETI   Buchares           8086.47  7992.41   +1.18%  -18.95%
 .SBITO  Ljubljan  <.SBITO   797.37   793.12   +0.54%  -13.88%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  1534.84  1525.46   +0.61%  -23.92%
 .BELEX  Belgrade  <.BELEX   656.61   665.81   -1.38%  -18.10%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   448.02   447.74   +0.06%  -21.14%
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
         Czech                                         spread
 CZ2YT=    2-year  <CZ2YT=   0.6050   0.0630   +137bp    +7bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   0.8590  -0.0120   +160bp    -2bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   1.3330   0.0770   +186bp    +5bps
 =RR     10-year   =RR>                             s  
 PL2YT=    2-year  <PL2YT=   0.5330   0.0330   +129bp    +4bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   1.0680   0.0290   +181bp    +2bps
 RR                RR>                              s  
 PL10YT            <PL10YT   1.5560   0.0210   +208bp    -1bps
 =RR     10-year   =RR>                             s  
                            3x6      6x9      9x12     3M
         Czech     <CZKFRA     0.30     0.29     0.33     0.90
         Rep       ><PRIBO                             
         Hungary   <HUFFRA     1.18     1.12     1.09     1.09
         Poland    <PLNFRA     0.27     0.27     0.28     0.68
         Note: FRA quotes are for                             
         ask prices                                    
0 : 0
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