WARSAW: The Hungarian forint and Polish zloty eased about 0.2 percent against the euro on Friday, leading losses among central European currencies amid a heightened global mood of risk aversion.
At 1018 GMT, the forint traded at 311.7500 and the zloty at 4.1945 per euro. The two currencies are the most liquid in the region this year and so their reaction to global sentiment is the most visible.
"The end of the week is likely to see continuation of pressure on CEE currencies due to negative sentiment on global markets. There are no important events or data releases in today's agenda that could affect the market moods significantly," Polish bank BZ WBK said in a daily note.
"Sharply rising US yields have spurred a bitter mood for risky assets in general and EM FX in particular. The negative sentiment may continue for a while more, but EM FX has lots of potential in the medium term," Nordea said in a report.
A Reuters poll published this week showed that the zloty will rise within 12 months by one percent against the euro, reaching 4.12 per euro by end-January. The Czech crown and Hungarian forint will also continue strengthening.
The region's currencies have held up well at the beginning of this week, helped by Central Europe's strong economic fundamentals, amid a massive global sell-off in stock markets.
Last year, the crown and zloty were some of the world's top-performing currencies, gaining about five percent against the euro and around 20 percent against the dollar. The Czech crown was almost unchanged on Friday at 25.2890 per euro.
"We have now become even more positive on the CZK, as the positioning doesn't seem to limit the CZK strengthening and with the robust economic growth and inflation rate slightly above target, the CNB will in our view hike two times more this year, giving further support to the CZK," Nordea said.
Regions stock exchanges also suffered losses on Friday, with the biggest falls seen in Prague, Budapest, Bucharest, and Zagreb.
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