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  • Dec 10th, 2012
  • Comments Off on Rate cuts in CEE seen weighing on currencies
Central European currencies are expected to tread water in the next few months as central banks in the region scramble to help slowing economies with interest rate cuts, a Reuters poll showed on Friday. But on the 12-month horizon, the Czech crown could firm 3.3 percent to the euro, Poland's zloty 3 percent and the forint and the leu 0.7 percent, according to the October/ 31-November 1 survey of 22 analysts.

In the next three months only the Czech crown is seen posting modest gains, after this week's falls. Those were prompted by a surprise cut in interest rates.

Hungary has cut rates 3 times in as many months and Poland could also ease next week. The banks prioritise helping economic recovery over fighting inflation. The crisis in the region's Western export markets has pushed the Czechs and Hungary into contraction and Romania to the brink of recession. Once robust Poland is slowing. Analysts see the crown - a regional underperformer this year - firming 0.7 percent to the euro in the next 3 months to 25.00 from Thursday's close, Hungary's forint and Romania's leu could ease 0.4 percent and the zloty half percent.

Copyright Reuters, 2012


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