With the beginning of a brand new month, the calendar within the CEE area can be busy once more. Right now, GDP figures for the second quarter in Poland and Turkey and PMIs throughout the area can be launched. We may also see GDP information this week – in Hungary tomorrow and in Romania on Friday.
Extra fascinating would be the launch of Turkey’s inflation information for August, the place we anticipate a slowdown from 2.1% to 1.5% month-on-month. This could translate into 32.2% YoY, supporting a 300bp fee lower in September in our forecast.
On Wednesday, the Nationwide Financial institution of Poland may also meet and is predicted to chop charges once more by 25bp to 4.75%, according to market expectations. We’ll be holding a better eye on the press convention the next day and the ahead steerage for the remainder of the 12 months, given the marginally improved inflation image in addition to the higher-than-expected public finance deficit for subsequent 12 months.
On Thursday, inflation information can be launched within the Czech Republic, the place 2.7% needs to be confirmed for August, the identical as within the earlier month. On Friday, we’ll see extra financial information from Hungary and the Czech Republic.
EUR/CZK has seen one in every of its largest one-day strikes this 12 months, rapidly sliding to 24.450 after Friday’s stable GDP information. Whereas we noticed an analogous response in charges and have been bullish on the Czech koruna for a while, we consider that the FX transfer was too quick, and we must always see some correction right here, extra prone to ranges round 24.500.
Not like the bond market, EUR/PLN didn’t react to the worse-than-expected draft state funds for subsequent 12 months, however we’re nonetheless on the highest ranges for the reason that starting of August. The fiscal outlook could also be a motive for the NBP to herald hawkish ahead steerage, which makes the Polish zloty enticing at present ranges, and we may see a return to decrease ranges under 4.250 EUR/PLN this week.
EUR/HUF stays with no main story for now, and we’re somewhat impartial right here. Nevertheless, the foreign money nonetheless retains its lengthy positioning from the summer time, which makes the Hungarian forint weak to exterior shocks, in our view.
Frantisek Taborsky
About The Author
