BUDAPEST/BUCHAREST: Poland's zloty and Hungary's forint jumped against the euro as Polish economic data on Monday added to evidence that most economies in Central Europe are growing robustly, at annual rates around 3 percent.
Growth in the region is "a new, big theme" prompting "regional currency outperformance, with the zloty and forint leading the way," said Standard Bank analyst Timothy Ash in a note. Polish industrial output rose 8.8 percent in annual terms in March and retail sales rose 17.4 percent from February.
The zloty and the forint had firmed 1 percent against the euro by 1233 GMT. The zloty at 3.989 touched its strongest levels for almost 4 years and the forint traded at 298.21, near 18-month highs, even though Hungary's central bank is expected to cut its base rate by 15 basis point on Tuesday to 1.8 percent.
European Central Bank bond purchases are encouraging investors to put cheap money into European emerging economies which have relatively strong fiscal and current accounts.
But worries that Greece may run out of money put a lid on Romanian assets and the leu eased a shade to 4.425 against the euro. Romania sold 10-year bonds with a residual maturity of 6 years at an auction at a maximum yield of 2.72 percent, a touch up from Friday's market levels.
Bulgaria is at the top of the list of states exposed to Greece: seven percent of its exports go there and 23 percent of its banking assets are owned by Greek banks, followed by Macedonia, Albania, Serbia and Romania, Commerzbank said in a note.
Romanian Central Bank Governor Mugur Isarescu said Romania's macroeconomic indicators were the best he had seen in 25 years, but warned of fiscal risks.
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