* FX steady as stocks give support, bonds tick up
* G20 finance ministers meetings gives no impulse
* Romania leu awaits IMF details
(Adds details, fixed income)
By Jason Hovet
PRAGUE, March 16 (Reuters) - The Polish zloty and Hungarian
forint edged higher on Monday due to a rise in stocks, but were
off morning highs after a weekend meeting of G20 finance
ministers failed to boost investor sentiment.
The forint, zloty and Czech crown gained the most in months
last week on the back of a global stocks rally based on hopes
that the troubled banking sector was near a turning point.
Switzerland's central bank also bought foreign currencies,
bringing relief to central European households that have
borrowed in francs. []
But analysts and dealers said a pledge of support from G20
financial policymakers after a weekend meeting had proved short
on specifics and would likely fail to put a definitive floor
under global emerging markets before a broader summit on April 2
[]
"The expectations regarding the G20 summit in early April
have reached the absolute zero point," Commerzbank said in a
note, adding countries with fragile external debt could come
under pressure.
"The safe havens of the financial markets should remain in
demand. This is bad news for the Eastern European currencies.
Last week's recovery should be difficult to continue this week."
The forint <EURHUF=> added 0.5 percent from Friday's
domestic close to 298.1 per euro by 1035 GMT. Poland's zloty
<EURPN=> gained 0.8 percent to 4.468 per euro and the Czech
crown <EURCZK=> dipped 0.2 percent.
The forint and zloty have firmed more than 5 percent since
March 6, and the crown has added almost 4 percent in that time.
Asian stocks hit a one-month high overnight, setting up
early 1-2 percent gains in Europe. [] The Swiss
franc weakened, adding some support to central Europe's
currencies through local cross rates.
"Liquidity is low on the market," a Prague currency trader
said. "We should be moving sideways today as there is no real
strong story out there."
Bond prices in the region firmed. Czech markets were looking
to the government's first fixed rate bond issue since October at
an auction on Wednesday, and dealers said expectations of new
domestic issues would put the local market under pressure.
In Romania, the leu <EURRON=> was down a touch. Dealers said
it would stay in tight ranges until signs emerge of the outcome
of talks with the International Monetary Fund on an aid package.
A document over the weekend showed European Union leaders
will this week raise the possibility of topping up a 25 billion
euro ($32 billion) crisis fund for hard-hit eastern European
economies. []
Romania is likely to become the third EU member to receive
outside aid for external financing after Hungary and Latvia.
Emerging Europe's once booming economies -- fuelled in the
past with foreign credit and investment -- have been hammered by
a fall in demand for its goods from a recession-hit euro zone.
But policymakers, especially from stronger countries like
the Czech Republic and Poland, have been at pains to point out
fundamental differences in their countries, while EU leaders
have rejected proposals for a mass bailout of the region.
----------------------MARKET SNAPSHOT-------------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 26.613 26.553 -0.23% +0.53%
Polish zloty <EURPLN=> 4.468 4.502 +0.76% -7.9%
Hungarian forint <EURHUF=> 298.06 299.4 +0.45% -11.58%
Croatian kuna <EURHRK=> 7.41 7.41 0% -0.61%
Romanian leu <EURRON=> 4.284 4.278 -0.14% -6.29%
Serbian dinar <EURRSD=> 94.18 94.24 +0.06% -4.99%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond CZ2YT=RR -2 basis points to 234bps over bmk*
4-yr T-bond CZ4YT=RR +18 basis points to +275bps over bmk*
8-yr T-bond CZ8YT=RR -9 basis points to +305bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -11 basis points to +421bps over bmk*
5-yr T-bond PL5YT=RR -9 basis points to +366bps over bmk*
10-yr T-bond PL10YT=RR -11 basis points to +295bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR -27 basis points to +1055bps over bmk*
5-yr T-bond HU5YT=RR -19 basis points to +982bps over bmk*
10-yr T-bond HU10YT=RR -20 basis points to +815bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1126 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
For related news and prices, click on the codes in brackets: All
emerging market news []
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(Reporting by Reuters bureaus, writing by Jason Hovet; editing
by Patrick Graham)
