CEE MARKETS-Crown at fresh low as FX fades, Romania debt market tested

By Reuters News

- Emerging Europe's currencies fell on Thursday, with the Czech crown at a five-month low, as rising US yields and a stronger dollar cut into investor appetite, while the region's debt auctions were watched, including in Romania, where a political crisis persists.

  • The global backdrop has been a main driver for central Europe's assets in recent trading, with the region's main reference currency, the euro, at its lowest in 17 months and US Treasury yields showing their biggest quarterly rise since 1994.

  • Romania's finance ministry was scheduled to hold a debt auction on Thursday, as was Hungary's debt management agency.

  • "There is a global selloff in the bond market ... and it, obviously, affects our region as well ... What is new is that markets did not react to oil prices ... falling below 100 dollars," a Budapest-based bond trader said. "I expect today's auction to go okay ... The Hungarian story is still buoying the market."

  • "I expect today's auction to go okay... The Hungarian story is still buoying the market," the trader added.

  • Hungary's 10-year benchmark bond yield was up 6 basis points today to 5.85%, the trader said, while the forint led losses against the euro, shedding 0.4% to 367.95 by 0907 GMT.

  • While the zloty and the crown have fallen over the past month, the forint has been buoyed by the pro-European stance of Hungarian Prime Minister Peter Magyar, who took power in May and put euro adoption back on the agenda.

  • The zloty was down 0.3% at 4.3770 per euro while the crown eased 0.1% against the common currency to 24.4640.

  • In Romania, Prime Minister-designate Siegfried Muresan failed to win a parliamentary vote of confidence on Wednesday, extending an impasse. President Nicusor Dan said on Wednesday that he will nominate a new prime minister by next Monday.

  • Analysts see possible pressure on the country's investment grade rating as Romania still tackles one of the EU's biggest budget deficits.

  • "Despite no clear path to a new government, markets remain stable ... The key test, however, will be (rating agency) S&P's sovereign rating review on Friday," ING wrote in a note.

CEE MARKETS SNAPSHOT AT 1107 CET

CURRENCIES

Latest trade

Previous close

Daily change

Change in 2025

Czech crown

24.4640

24.4320

-0.13%

-1.22%

Hungary forint

367.9500

366.3500

-0.43%

+4.46%

Polish zloty

4.3770

4.3635

-0.31%

-3.69%

Romanian leu

5.2748

5.2705

-0.08%

-3.43%

Serbian dinar

117.3800

117.5500

+0.14%

-0.07%

Note: daily change calculated from 1800 CET

STOCKS

Latest

Previous close

Daily change

Change in 2025

Prague

.PX

2639.25

2675.2500

-1.35%

-1.73%

Budapest

.BUX

143404.50

145181.93

-1.22%

+29.16%

Warsaw

.WIG20

4124.33

4181.83

-1.37%

+29.53%

Bucharest

.BETI

31674.63

31093.91

+1.87%

+29.61%

BONDS

Yield (bid)

Yield change

Spread vs Bund

Daily change in spread

Czech Rep 2-year

4.3367

0.0777

+115bps

+8bps

Czech Rep 5-year

4.7027

0.0626

+135bps

+5bps

Czech Rep 10-year

5.3908

0.0643

+179bps

+4bps

Poland 2-year

4.9200

0.0400

+173bps

+4bps

Poland 5-year

6.0350

-0.0200

+269bps

-4bps

Poland 10-year

6.3780

0.0150

+278bps

-1bps

FORWARD RATE AGREEMENTS

3x6

6x9

9x12

3M interbank

Czech Rep

,

4.33

4.65

4.86

3.87

Poland

,

4.33

4.82

4.99

3.85

Note: FRA quotes are for ask prices

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