CEE MARKETS-Zloty Halts Gains, Markets Consider Supreme Court Decision on Foreign Exchange Lending

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By Anita Komuves BUDAPEST, Sept. 2 (Reuters) – Central European currencies were mostly stable on Thursday, with the Polish zloty halting its gains of the past two sessions as investors eyed the Supreme Court that could deliver a long-awaited ruling on foreign exchange ready later in the day. The Supreme Court ruling could clarify how Swiss franc mortgage holders should settle with banks after the decision to cancel the loan agreement. The decision can decide the size of the banks’ losses on these loans. The Polish zloty remained stable, ending its steady gains from the previous two sessions that followed a surge in inflation data that fueled expectations of a political tightening later this year. Elsewhere, the Czech Koruna strengthened 0.1% to 25.334 against the common currency. The Hungarian forint edged up 0.09% to trade at 347.5 per euro, trading in its recent range between 347 and 350. Government bond yields in Hungary were flat after rising by 7 to 8 basis points at the long end of the curve on Wednesday when they followed the rise in base yields that followed hawkish comments from the European Central Bank, a fixed income trader said. Eurozone government bond yields hit their highest levels in around six weeks on Wednesday, driven by hawkish rhetoric from policymakers that fueled unease over the future pace of ECB bond purchases. Last week, longer-term government bond yields in Hungary rose by around 10 basis points after the reduction in sales of government bonds in the first auction after the Hungarian central bank announced that it would start to reduce its purchases, which worried investors. Shares in the region were mixed, with Prague adding 0.24% while Budapest slipped 0.53%. Warsaw stocks lost 0.06% while Bucharest’s fell 0.03%. SNAPSHOT OF EEC MARKETS T 1026 CET CURRENC IES Last daily change previous change of bid closing in 2021 EURCZK = Czech EURHUF = Hungary 0 EURPLN = Polish EURRON = Romania EURHRK = Croatia EURRSD = Serbian 0 Note: calculated from of 1800 daily change CET Last previous daily change close change in 2021 .PX Prague 1293.38 1290.250 + 0.24% +25.92 0% .BUX Budapes 51672.8 51946.96 -0.53% +22, 72 t 7% .WIG20 Warsaw 2369.62 2371.16 -0.06% +19.44% .BETI Bucare 12298.8 12302.26 -0.03% +25.43 st 3% .SBITOP Ljublja <.sbitop na> % .CRBEX Zagreb 1971.40 1967.92 + 0.18% + 13.35% .BELEX1 Belgrad <.belex1 e> .SOFIX Sofia 564.93 565.11 -0.03% + 26.23% Yield Yield Spread Daily variation (bid) vs Bund variation of the Czech spread Republished CZ2YT = R s CZ5YT = R s CZ10YT = s Poland PL2YT = R s PL5YT = R s PL10YT = s FORWARD 3×6 6×9 9×12 3M Czech interbank 1.65 2.07 2.22 0.99 Rep. Hungary 2.11 2.25 2.32 1.60 Poland 0.48 0.75 0, 98 0.23 ******************************************* *** **** ********** (Additional reporting by Alan Charlish in Warsaw; Editing by Rashmi Aich)


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