Markets

Kuna rises as revenues, risk appetite outweigh politics

Published April 28, 2017 Updated April 28, 2017 02:52pm

Other regional currencies also rose, still riding the wave of centrist Emmanuel Macron's win on Sunday in the first-round of France's presidential election - seen as a vote for stability and staying in the European Union.

The kuna had sunk on Thursday after Croatian Prime Minister Andrej Plenkovic fired ministers from his junior coalition partner, saying they had failed to support the finance minister in his handling of a corporate crisis.

The ministers' Most (Bridge) party pulled out of the coalition on Friday - raising the possibility of a snap election or at least a period of political wrangling - but the currency firmed 0.26 percent on the day to 7.465 per euro by 1352 GMT.

Analysts said a seasonal pick-up in tourism revenues, and relief over the French result all supported the kuna, though one dealer at a local bank said the local political problems could still weigh on the currency down the road.

"I expect certain easing pressures to persist in the coming days or weeks due to the Agrokor crisis and political uncertainties," the dealer said, referring to the financial crisis at retail and food group Agrokor, Croatia's biggest private firm.

The Czech crown firmed 0.3 percent to 26.94 per euro.

It rebounded sharply from levels past 27, which it reached on Thursday for the second time since the central bank removed a cap three weeks ago which had kept it weaker than 27 for years.

The zloty touched a one-month high at 4.2133, a hairbreadth from 18-month highs beyond 4.21, before giving up most of its gains in late trade.

The yield on Czech 10-year bonds was flat at 0.99 percent and the corresponding Polish yield rose 5 basis points to 3.45 percent as JPMorgan, which runs the most widely used emerging debt indexes, added Czech papers to its GBI-EM index as of Friday, cutting the weighting of Polish bonds.

The stocks of Bulgaria's third-largest bank, Fibank jumped 9 percent to a 9-year high, after it hired Citigroup to advise on strategic options including drawing in new owners.

 

Copyright Reuters, 2017