2/14/2006

Hungary's forint, bonds ease on renewed political jitters in Poland

Hungary's forint, bonds ease on renewed political jitters in Poland

Hungary's forint and government securities eased on Monday as the negative market impact of rekindled political woes in Poland spilt over to Hungarian markets. At 16:37 local time the HUF traded at 251.70/252.00, weaker than its Friday finish at 250.70/251.25.

Local reports have suggested that Polish President Lech Kaczynski is close to calling early elections, despite the fact that the ruling PiS party of his twin brother Jaroslaw signed recently a stabilisation pact with the small populist Samoobrona and LPR. Today we know it would not happen.

The 14-day period within which the head of state can dissolve parliament after it failed to meet the constitutional deadline for approving the 2006 Budget runs out on 14 February.
If the president decides to exercise this right, he will then have to at the same time call early elections for a date no later then 45 days from the announcement, with 26 March the last such possible date.
Government securities yield rose about 5 basis points in the morning and another 5-7 points in the afternoon.

The next domestic market-moving events will be Thursday's release of January inflation data and two bond auctions, HUF 35 bn worth of 10-year and HUF 45 bn worth of 5-year instruments.



Flights to Poland

Novea - Business in Poland