* NBR raises key interest rate by 50 basis points * Polish zloty weakens 0.31% * Sentiment in Asia weighs on Central and Eastern European markets – Analyst. (Paraphrasing of Romanian interest rate decision) By Alan Sharlish and Luisa Eli WARSAW (Reuters) – The Romanian leu fell on Tuesday afternoon after the central bank raised interest rates less than expected on fears of a slowing economy. Policy makers are weighing the impact of higher inflation against growth risks from policy tightening too far, and the Romanian National Bank (NBR)’s decision to raise its key interest rate by 50 basis points to 6.75% came as it said the economy would be intact. “Semi-deadlock” in the second half of this year. Analysts polled by Reuters had expected a 75 basis point increase to 7.00%. At 1355 GMT, the lei was 0.17% weaker against the euro at 4.8975, after weakening 0.1% before the decision. “The leu has no fundamental reason to hold, given the size of Romania’s deficit,” said Ionut Dumitru, chief economist at Raiffeisen Bank in Romania. “We expect another 50 basis point rise at the bank’s January meeting, which should be the last based on current developments.” The Polish zloty was 0.31% weaker at 4.6905, after holding steady the previous day. The National Bank of Poland (NBP) is expected to raise the key interest rate by 25 basis points to 7.00% on Wednesday. “We have the MPC meeting in Poland tomorrow, so it probably won’t happen much in the future…this is just a small correction,” said a currency trader from Warsaw. The Hungarian forint fell 0.76% to 403.10, while the Czech kroon slipped 0.10% to 24.33. Sentiment in Asia is weighing on central European currencies, said Piotr Poplawski, chief economist at ING in Warsaw. The Chinese yuan weakened slightly against the dollar on Tuesday, as a sharp rise in COVID-19 cases and unexpectedly weak trade data offset optimism about an eventual economic reopening that fueled sharp fluctuations in the currency last week. “The market is speculating about what China will and won’t do (on COVID-19) and this is driving the Central and Eastern European currencies one way or another,” Poplawski said. CEE SNAPSH at 1455 CET MARKETS OT CURRENCIES Latest Previo Daily Change our closing price offer in 2022 Czechia 24.330 24.306 -0.10% +2.23 crown 0 0% Hungary 403.10 400.05 -0.76% -8.36% forint 00 00 Polish 4.6905 4.6760 -0.31% -2.12% zloty Romania 4.8975 4.8890 -0.17% +1.04 n leu% Croatia 7.5360 7.5365 +0.01 -0.25% n kuna% Serbian 117.20 117.25 +0.04 +0.32 dinar 00 00% Note: Calculated from 1800 per day Latest CET Change Latest Previo Daily Close Change in 2022 Prague 1238.4 1233.2 +0.42 3100% Budapes 43426. 43812. -0.88% -14.38 t 63 28% Warsaw 1622.1 1618.1 +0.25 -28.44 4 4% Buchare 11137. 11023. +1.04 -14.73 st 69 13% Ljublja 1005.2 1004.9 +0.03 -19.93 Na 7 9% Zagreb 1915.7 1900.3 +0.81 -7.87% 0 0% Belgrade <.BELEX15 786.56 787.52 -0.12% -4.17% e > Sofia 592.76 592.98 -0.04% -6.75% Yield Daily Return Spread (quote) Change vs. Change in Czech Republic Spread 0 ps 0 ps 0 ps Poland 0 ps 0 ps 0 ps FORWARD 3×6 6×9 9×12 3M interb ank Czech Republic < 7.34 7.32 7.07 7.30 Rep PRIBOR=> Hungary < 15.37 14.74 14.02 16.39 BUBOR=> Poland < 7.72 7.91 7.88 7.61 WIBOR=> NOTE: TO ASK FRA PRICES ************************************************* * ******** ************ (Reporting by Alain Sharlich in Warsaw, Luisa Ely in Bucharest, Anita Komovice in Budapest, Jason Hovet in Prague; Editing by Vinay Dwivedi)
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