Forex - Emerging Europe Closing Summary and Highlights 19 June

 15:23 (GMT) 19 Jun

  [Forex Highlights]

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Emerging Europe Closing Summary and Highlights 19 June (0101-MFNX-C01)


While Hungarian government bond yields rose by 3-7bps across the curve on Wednesday, the forint extended its losses, still underperforming its CEE-3 peers with the EUR/HUF breaking above the 323.50 resistance level.


Russian government bond yields decreased by 2-10bps across the curve on Wednesday and the ruble continued to strengthen, with the USD/RUB falling below the 63.90 level. Assets were supported by the U.S. dollar's broad-based depreciation ahead of the Fed decision and higher oil prices after EIA data showed that U.S. crude stocks fell by 3.1mn barrels last week compared to the expected 1.1-1.3mn barrel decrease.


While most South African government bond yields decreased by 3-8bps on Wednesday, the rand depreciated a bit on profit taking after the gains recorded in the previous several sessions, with the USD/ZAR temporarily rising to 14.58. The currency was not helped by data showing that headline CPI inflation edged up to 4.5% y/y in May from 4.4% y/y in April, a tad above the consensus forecast of 4.4% y/y.


Most Turkish government bonds were generally stable on Wednesday but the lira weakened, underperforming other EMEA currencies with the USD/TRY briefly rising to 5.9154 after it breached the 5.90 resistance level. The currency was hurt by the Bloomberg report, according to which the U.S. was considering three sanctions packages in response to Turkey's acquisition of the Russian S-400 missile system. The most likely of them would cut Turkey's defense companies from the U.S. financial system while the harshest would "all but cripple" its economy.

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