Romania's leu buoyed by expectations of benign S&P report

* S&P to publish good report for Romania- minister
* Government pledges to soften its tax plans
* President signs budget bill into law

By Radu-Sorin Marinas
BUCHAREST, March 15 (Reuters) - Romania's leu
extended its gains against the euro on Friday after rebounding
from six-week lows in the previous session, supported by
expectations of a benign report from Standard & Poor's on the
country's credit rating outlook.
The rating agency is expected to announce its decision late
on Friday or on Saturday.
"We're going to hear a very good (S&P) decision," Finance
Minister Eugen Teodorovici told a private television channel.
Romanian asset prices have been jittery since the leftist
government announced three months ago a raft of new taxes on
energy companies and banks to finance higher state spending.
The tax on bank assets has complicated monetary policy
because it is linked to interbank rates. The government promised
to amend the tax after S&P gave Romania two weeks from March 2
to appeal its credit rating outlook.
The rating agency did not publish that rating outlook but it
was widely understood in financial markets to be negative,
revised down from stable.
"The 4.7500-4.7700 (leu) range should hold for today,
awaiting the S&P review tonight. This comes after a two
week delay due to the Romanian government's appeal against its
revision of the outlook to negative from stable," ING Bank
analysts in Bucharest said in a note.
By 1100 GMT, the leu had firmed 0.2 percent
against the euro to trade at 4.7560.
Earlier on Friday President Klaus Iohannis, a critic of the
ruling Social Democrats' budget which he and many economic
analysts had branded as unrealistic, signed the bill into law
after he had exhausted all legal ways to halt it.

The Polish zloty and the Czech crown
both traded virtually flat to the euro on Friday, at 4.3050 and
25.671 respectively.
Hungarian markets were closed for a national Holiday.


CEE SNAPSHOT AT 1110
MARKETS CET
CURRENCIES
Latest Previous Dail Change
y
bid close chan in 2019
ge
Czech 25.6660 25.6610 -0.0 +0.16%
crown 2%
Hungary 314.3500 314.3100 -0.0 +2.14%
forint 1%
Polish 4.3039 4.3025 -0.0 -0.33%
zloty 3%
Romanian 4.7574 4.7650 +0. -2.17%
leu 16%
Croatian 7.4180 7.4215 +0. -0.11%
kuna 05%
Serbian 118.0800 118.1100 +0. +0.19%
dinar 03%
Note: calculated from 1800
daily CET
change

Latest Previous Dail Change
y
close chan in 2019
ge
Prague 1073.75 1068.4300 +0. +8.84%
50%
Budapest 41335.02 41335.02 +0. +5.61%
00%
Warsaw 2325.69 2319.28 +0. +2.15%
28%
Bucharest 7889.24 7858.18 +0. +6.85%
40%
Ljubljana 874.01 869.00 +0. +8.67%
58%
Zagreb 1766.93 1770.01 -0.1 +1.04%
7%
Belgrade <.BELEX15 707.47 707.10 +0. -7.12%
> 05%
Sofia 580.79 579.50 +0. -2.30%
22%
BONDS
Yield Yield Spre Daily
ad
(bid) change vs change in
Bund
Czech spread
Republic
2-year <CZ2YT=RR 1.8110 0.0190 +23 +2bps
> 6bps
5-year <CZ5YT=RR 1.7730 -0.0130 +21 -1bps
> 5bps
10-year <CZ10YT=R 1.9190 0.0150 +18 +2bps
R> 4bps
Poland
2-year <PL2YT=RR 1.6260 -0.1090 +21 -10bps
> 7bps
5-year <PL5YT=RR 2.2410 0.0010 +26 +1bps
> 2bps
10-year <PL10YT=R 2.8990 0.0100 +28 +2bps
R> 2bps
FORWARD RATE AGREEMENT
3x6 6x9 9x12 3M
interbank
Czech Rep < 2.19 2.23 2.24 2.03
PRIBOR=>
Hungary < 0.41 0.60 0.80 0.14
BUBOR=>
Poland < 1.74 1.73 1.74 1.72
WIBOR=>
Note: FRA are for ask prices
quotes
*************************************************
*************

($1 = 278.1600 forints)

(Editing by Gareth Jones)



2019-03-15 13:07:23

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