Stiri	Stiri afaceri	Stiri companii	Evenimente de afaceri

Erste CEE Macro Comments

RO Politics+FX: Shortly after the prime minister presented the new labour code in parliament, the opposition filed a no-confidence motion that will be decided next Wednesday.

The new labour code is a top requirement of the IMF and also of foreign investors and should increase the flexibility of the labour market. We think the government will survive this no-confidence vote and see the opposition strategy to topple the government as more of an attempt to score among its own electorate. The most recent political events were no news for the FX market and the RON appreciated to a fresh nine-month high of 4.18. Our forecast for end-2011 EURRON is 4.1.

HU Macro: Preliminary industrial output figures surprised to the upside by showing a 13.6% y/y growth in unadjusted, and 10.9% in working-day adjusted terms. We expected 10.5% yearly growth while the consensus stood at 7.7%. Monthly growth shows a spectacular 15.5% increase. The data comes after a significant monthly drop in December (-13.3% m/m, revised from -11.8%). The impressive January figure can be considered a continuation of the trend in industry seen in the autumn months of 2010. We believe HUF FX and FI markets are currently fairly valued.

HR Monetary: The CNB cut the commercial bank rate of minimum required foreign currency claims from 20% to 17% to inject approx. EUR 850mn (HRK6.3bn) into the system for the financing of investment projects. As liquidity of the system is already good, these funds should result in more favorable interest rates and easier accessibility to funds for all projects with realistic prospects of being competitive on domestic and foreign markets. We expect the HRK to appreciate by 1.4% versus the Euro by June.

HR T-Bills: Yesterday's T-bill auction attracted robust investor interest for HRK papers, allowing for considerably higher than initially planned issuance (HRK 1.12bn vs. HRK 550mn). We expect broadly stable yields performance supported by robust market liquidity and limited sensitivity to fiscal risks and ongoing anti-government protests.

TU Central Bank: The inflation expectation survey saw an upward revision to CBT year end inflation expectations to 6.8% from 6.6%. Rising oil prices and exchange rate depreciation are the drivers. We think that CBT to opt to keep policy rates on hold until general elections in June and raise shortly after that. In total we expect hikes of 125bp by year end.

TU Fiscal: Februarys cash budget points to strong fiscal performance which we think will most likely deteriorate before the general election but we don't expect a significant deviation from fiscal prudence over the course of the year. We see TRY appreciating by 7.3% from current levels by year end.

Traders' comments:

HRK Bonds: 2013 & 2015 HRK bonds were bid only after the strong T-bill auction as yields dropped big time.

CEE CDS & Credit: Besides Russia erasing some of its recent outperformance and Turkey erasing some of its recent underperformance there was not too much going on yesterday and the SovX CEE closed relatively unchanged. Friday may cause some tension as both an extraordinary Eurozone Leaders meeting to discuss the so-called 'Competitiveness Pact', seen as a precursor to any rescue plan for the peripheral Eurozone member countries expected to be tabled at the summit on March 24th, and 'Day of Rage' protests in Saudi Arabia are planned. Greece 10y bond yields are now trading close to 13% after Moodys 3 notch downgrade to B1 in spite of the bail-out, putting the effectiveness of any bail-out plan into question. Portugal will brave the markets today in a show of bravour but we think things will come to a head very soon and believe the tightening trend between SovX CEE and SovX WE can continue. We see relative value in some scarce Slovenian bonds at the moment. SID Banka (the Slovenian Development & Export Bank) has an explicit government guarantee and is rated Aa2 (stable) but pays a 58% spread premium compared to a similar maturity sovereign.Telekom Slovenija, which has an implicit guarantee and is rated Baa1, is currently pricing around ASW levels of 150 bps. Not bad for a defensive sector in this environment.

Sursa: http://www.erstegroup.com

Tags: after euro

Articole similare