CEE MARKETS-Forint holds gains on signs IMF deal closer
BUCHAREST, Oct 8 (Reuters) - Emerging European currencies edged lower on Monday, while signs Hungary is moving closer to an international financing deal helped the forint hold on to Friday's sharp gains.
Budapest scrapped a disputed tax on its central bank and unveiled a swathe of new measures on Friday to keep its deficit under control, removing an obstacle to an International Monetary Fund deal and sending the forint up more than 1 percent.
was bid 0.1 percent lower on the day at 282.62 per euro by 0740 GMT and one dealer said the eventual signing of an IMF deal to help Hungary's financing could push the forint above 280.
"We are drifting in the 282-283 range, I do not expect major flows today," the Budapest-based currency dealer said. "Overall, the region looks pretty calm."
The cost of insuring Hungary's debt against a default for five years
sank to around 340 basis points, its lowest level since August 2011, but markets will remain on edge until a deal is actually signed.
"A fault confessed is half redressed," Commerzbank said in a note. "Until the EU and IMF give the all clear, risk continues to concentrate on the upper end in EUR-HUF."
Elsewhere, assets were pressured by a bearish mood on global stock markets after the World Bank cut growth forecasts for Asia and underlined concerns over the global economic outlook.
Stocks fell across central Europe, led by near 1 percent drops in Budapest
and Bucharest . The Czech crown
slipped 0.3 percent after data showed a bigger-than-expected fall in industrial output and raised expectations of a fourth straight quarter of recession.
"The data published today can hardly be interpreted as good news for the Czech crown," said Raromir Jac, analyst at Generali PPF Asset Management.
remained near two-month lows as traders tested the level at which the central bank - which has often intervened to support the currency - would step in.
was 0.1 percent lower, with markets weighing the prospect of monetary policy easing after a central banker said he may vote for an interest rate cut in November.
Currency Latest Previous Local Local close currency currency change change today in 2012 Czech crown 24.89 24.826 -0.26% +2.63% Polish zloty 4.069 4.067 -0.05% +9.72% Hungarian forint 282.62 282.3 -0.11% +11.32% Croatian kuna 7.478 7.478 0% +0.51% Romanian leu 4.575 4.566 -0.2% -5.55% Serbian dinar 114.86 114.87 +0.01% -6.89%
All data taken from Reuters at 0940 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
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