News

PRAGUE, March 25 (Reuters) - Central Europe's main currencies pushed higher on Monday, with the forint looking for stronger levels before a Hungarian interest rate decision this week.

Eyes will be on Hungary's central bank on Tuesday, when analysts expect policymakers to revert back to a slower pace of policy easing after the forint fell to one-year lows.

The forint EURHUF= edged 0.1% higher on Monday, sitting at 396.60 to the euro at 0954 GMT. It had weakened near to the psychological 400 level earlier this month for the first time since March 2023.

Hungary has had the European Union's highest interest rates and a Reuters poll forecast a cut this week by 75 basis points (bps), to 8.25%, a softer move than a 100-bp move last month.

Some analysts saw chances of both a larger or smaller move than 75 bps.

"In our view, the majority of the Monetary Council will see the usual post-cut currency depreciation as too much of a risk so close to both psychological and technical levels at and above 400," ING said.

"Moreover, with cautiousness being the mantra, with the situation less clear than in February, we see the National Bank of Hungary will be rather safe than sorry."

A weakened crown prevented Czech central bankers from agreeing a faster pace to its easing cycle last week.

The crown EURCZK= was 0.2% stronger at 25.285 to the euro on Monday, in the middle of a range it has bounced around since hitting two-year lows beyond 25.50 a month ago.

In Poland, the zloty EURPLN=, which has posted a slight overall gain so far in 2024, unlike the forint or crown, as Polish rates stay on hold, rose 0.2% in morning trade, to 4.309 per euro. It had traded at four-year highs beyond 4.30 earlier this month.

Currencies were helped higher by a weaker dollar and slightly higher risk appetite in markets. Last week, the U.S. Federal Reserve stuck with projections for three rate cuts by year's end.

CEE MARKETS

SNAPSHOT

AT 1054 CET

CURRENCIES

in 2024

EURCZK=

Czech crown

EURCZK=

EURHUF=

Hungary forint

EURHUF=

EURPLN=

Polish zloty

EURRON=

Romanian leu

EURRON=

EURRSD=

Serbian dinar

EURRSD=

Note: daily change

calculated from

1800 CET

in 2024

.PX

.PX

1490.6600

.BUX

.BUX

.WIG20

2367.37

2377.69

.BETI

.BETI

vs Bund

change in

CZ2YT=RR

2-year

+090bps

-6bps

CZ5YT=RR

5-year

+140bps

+0bps

CZ10YT=RR

10-year

CZ10YT=RR

+157bps

-2bps

PL2YT=RR

2-year

PL2YT=RR

+246bps

+0bps

PL5YT=RR

5-year

PL5YT=RR

+310bps

+0bps

PL10YT=RR

10-year

PL10YT=RR

+322bps

-1bps

FORWARD

9x12

3M interbank

CZKFRAPRIBOR=

HUFFRABUBOR=

PLNFRAWIBOR=

Note: FRA quotes

are for ask prices

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

(Reporting by Jason Hovet in Prague, Anita Komuves in Budapest and Pawel Florkiewicz in Warsaw; Editing by Alex Richardson)

((jason.hovet@thomsonreuters.com))

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