KBC Market Research Desk
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Situation in eastern Ukraine complicates further
Trading with Central European currencies produced mixed results on Monday on the background of deteriorated situation in eastern Ukraine and threats of more US sanctions imposed on Russia due to reluctance of the latter to fulfil the recent Geneva agreement. John Kerry, the US Secretary of State, urged his Russian counterpart, Sergey Lavrov, to engage in diplomatic resolution of the crisis and to appeal publicly to pro-Moscow gunmen for leaving seized government buildings in several Ukrainian cities.
The zloty lost about 0.3 % against the euro yesterday and thereby gave up most of its gains posted after the Geneva deal had been reached last Thursday. Meanwhile, the Hungarian forint strengthened by about 0.3 % and settled below the EUR/HUF 307 level, raising probability of an additional 10 bps rate cut at the central bank’s meeting next Tuesday.
Today, the regional macroeconomic calendar is eventless again and hence ongoing conflict in Ukraine continues to be the eye-catcher. Nevertheless, recent sessions indicate that markets have already got used to certain level of uncertainty and sensitivity of regional assets to the Ukrainian turmoil has been declining: it is distinctly lower now than in was in the time of Russia’s annexation of the Crimean peninsula.
This non-exhaustive information is based on short-term forecasts for expected developments on the financial markets. KBC Bank cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct or consequential loss arising from any use of this document or its content. The document is not intended as personalized investment advice and does not constitute a recommendation to buy, sell or hold investments described herein. Although information has been obtained from and is based upon sources KBC believes to be reliable, KBC does not guarantee the accuracy of this information, which may be incomplete or condensed. All opinions and estimates constitute a KBC judgment as of the data of the report and are subject to change without notice.
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