Look for:

Research Detail

2019/10/14 / Erste Group Research

CEE Insights | Foreign politics in focus


Politics will remain in focus this week. One would think that domestic factors would reign, but the weekend elections (parliamentary in Poland, municipal in Hungary) have not brought any material change and last week’s collapse of the Romanian government was the fourth one since the last elections in 2016. So, all eyes will be on the international political scene, particularly the European Council meeting scheduled for the end of this week, at which Brexit will be discussed. Any progress towards an agreement would be supportive for CEE countries and markets, as negative sentiment has already been taking its toll on confidence in industry and output.

The Polish zloty and Hungarian forint were the only CEE currencies to benefit from the stronger EUR and increased risk appetite, having appreciated last week. There have been new hopes raised about the feasibility of an orderly Brexit after the meeting of the Irish PM with Boris Johnson. Moreover, the first round of talks between China and the US went well. Other currencies were more affected by domestic factors.

We saw some yield spread compression in 10Y CEE bonds over German Bunds last week. Many CEE bonds did not follow the increase of German Bund yields (+15bp w/w), which seemed to be associated with an easing of the risk-off mode, as 10Y US Treasury yields went up as well (+19bp w/w). Serbia sold EUR 30.3mn of 10Y EUR-denominated bonds at an average yield of 1.89%.


PDF Download Download PDF (526kB)

General information

AuthorErste Group Research
Date2019/10/14
Languageen
Product nameCEE Insights
Topic in focusFX, Macro/ Fixed income
Economy in focusCEE, Croatia, Czech Republic, Hungary, Poland, Romania, Serbia, Slovakia, Slovenia
Currency in focusCroatian Kuna, Czech Koruna, Euro, Hungarian Forint, Polish Zloty, Romanian Leu, Serbian dinar
Sector in focus-
DownloadPDF (526kB) PDF Download



Accept

We use cookies and web analysis software to give you the best possible experience on our website. By continuing to browse this website, you consent for these tools to be used. For more details and how to opt out of these, please read our Data protection policy.

INFORMATION FOR CORPORATE AND INSTITUTIONAL CLIENTS

Any information, material and services regarding financial instruments and securities provided by Erste Group Bank AG or any of its affiliates (collectively “Erste Group“) on this and any linked website hereafter (jointly the “Websites”) shall be exclusively to investors who are not subject to any legal sale or purchase restrictions (the “Interested Party“).

The publication and distribution of information as well as offering and selling of products and services described on the Websites is prohibited by law in some jurisdictions. For this reason, persons in countries in which the publication as well as the offering and selling of products and services described on the Websites are not permitted by law, must not enter the Websites and/or acquire the products displayed on the Websites.

Neither Erste Group nor any third party shall offer access to the Websites or offer the products to especially, but not limited to citizen/residents of the United States and “U.S. person” (as defined in Regulation S under the US Securities Act 1933 as amended), citizen/resident of Australia, Canada, Great Britain and Japan. For this reason, the distribution or redistribution of the information, materials and products into United States, Australia, Canada, Great Britain and Japan or into any other jurisdiction where it is not permitted under the applicable law, as well as to the citizens/residents of these countries shall be prohibited.

The securities displayed on the Websites have not been and will not be registered under the US Securities Act of 1933 and trading in the securities has not been approved for purposes of the US Commodities Exchange Act of 1936. For this reason the securities may, inter alia, not be offered, sold or delivered within the United States or, for the account and benefit of U.S. persons.

The Interested Party is solely responsible to examine, whether he may enter the Websites under the law applicable to it. Erste Group shall not be responsible for the distribution of content of any of the Websites to individuals or entities which provide false information about their right to enter the Websites. For this reason Erste Group shall not be liable for any legal claims or damages which may result from the unauthorized entering or reading of the Websites.

By agreeing to this hereto, the Interested Party confirms that
(i) It has read, understood and accepted this Information and the Disclaimer;
(ii) It informed itself about any possible legal restriction and warrants that it is not restricted or prohibited to enter the Websites according to any law applicable; and
(iii) It does not make available the contents of the Websites to any person who is not qualified by law to enter the Websites.
(iV) It is no consumer.