Stocks, currencies ease as optimism over stimulus measures loses steam
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BUDAPEST — Central European stock
indexes fell and currencies eased on Monday, as massive economic
support packages aiming to shore up economies battered by the
coronavirus pandemic failed to reassure markets.
“The negative mood could last until the number of cases
starts dropping globally,” a trader in Budapest said. “More
liquidity could be a solution in the short term but in the long
term it will not be able to fix the problem that people simply
cannot go to work.”
There were more than 720,000 confirmed cases of coronavirus
worldwide by Monday, and governments around the world kept
announcing stricter lockdown measures to combat the spread of
the virus, further halting economic activity.
“The CEE region looks so far more vulnerable than many other
EM economies amid the corona recession,” Nordea said in a note.
The reason for this, the note adds, is that economies of
these countries are based on exports to the European Union,
which has become the epicenter of the spread of the virus.
Budapest’s equities led losses by dropping 2.8% by
0758 GMT. Warsaw’s stock market was down 1.8% and
Bucharest lost 1.5%.
Czech stocks slipped with the rest of the region and
were down 2.1%. Prague-listed banking shares were under pressure
after the finance ministry said it was preparing a bill that
could mean a six-month blanket moratorium on mortgage, consumer
and business loan payments.
J&T Banka analysts said it was still difficult to assess the
exact impact and that benefits from the measures could also
come.
Regional central banks and governments have taken several
emergency steps recently to help their economies.
The Polish and the Romanian central banks have delivered
emergency rate cuts, and the Czech central bank cut rates on
Thursday for the second time in two weeks.
In Poland, another interest rate cut might be considered to
support the economy during the coronavirus outbreak, Polish
rate-setter Eryk Lon said on Monday.
The central bank in Hungary left its benchmark lending rate
at 0.9% last week and introduced a fixed-rate collateralised
loan instrument with unlimited liquidity, in addition to other
liquidity-supporting measures.
Regional currencies eased, with the Hungarian forint
leading losses by dropping 0.69% and trading at 358.03
to the euro. The Czech crown was down 0.46% at 27.425
to the euro while the Polish zloty slipped 0.16% to
4.537 to the euro.
CEE SNAPSHOT AT
MARKETS 0958 CET
CURRENCIE
S
Latest Previous Daily Change
bid close change in 2020
Czech 27.4250 27.3000 -0.46% -7.27%
crown
Hungary 358.0300 355.5500 -0.69% -7.51%
forint
Polish 4.5373 4.5299 -0.16% -6.19%
zloty
Romanian 4.8366 4.8375 +0.02% -1.00%
leu
Croatian 7.6120 7.6145 +0.03% -2.19%
kuna
Serbian 117.4600 117.4300 -0.03% +0.09%
dinar
Note: calculated from 1800 CET
daily
change
Latest Previous Daily Change
close change in 2020
Prague 764.98 781.2300 -2.08% -31.43%
Budapest 31170.63 32065.14 -2.79% -32.36%
Warsaw 1449.98 1475.90 -1.76% -32.56%
Bucharest 7414.22 7528.93 -1.52% -25.69%
Ljubljana 722.60 726.82 -0.58% -21.95%
Zagreb 1447.90 1457.57 -0.66% -28.23%
Belgrade
Sofia 418.07 421.68 -0.86% -26.41%
Yield Yield Spread Daily
(bid) change vs Bund change
in
Czech spread
Republic
2-year
5-year
10-year
Poland
2-year
5-year
10-year
FORWARD
3×6 6×9 9×12 3M
interban
k
Czech Rep
Hungary
Poland
Note: FRA are for ask prices
quotes
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(Additional reporting by Jason Hovet in Prague; Editing by Alex
Richardson)
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