Institutional Investors Still Bullish on CEE
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Commodities - Technical Analysis
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FX - Technical Analysis
The dollar continued to strengthen following last Friday’s unemployment data, so the trends against its major counterparts remained intact. However, the dollar’s momentum is not significant, so the question of how long this momentum can last will soon arise again. The forint is holding its ground and remains firmly anchored against its major counterparts. Trading against the forint still does not seem like a good idea. For the USD/JPY currency pair, the target could be 162.5 above the 159.38 level. The EUR/CHF exchange rate is also trending upward; due to the breakout from the trend line, there may still be room for further upward movement.
Over 30 senior financial professionals, active in CEE markets and managing more than EUR 6.5 billion in assets under direct control, participated in our Institutional Investor Survey. Here, we highlight the most notable insights.
Respondents taking higher risk relative to benchmark in equities and favoring EM and CEE exposures over the next 3 months. Institutional sentiment on CETOP country performance shows a clear rotation in expectations. Poland strengthens as the top pick for outperformance, while Hungary also gains traction.
The survey shows a clear shift toward neutrality on Max Index duration positioning as participants weigh two offsetting forces: (1) the government’s decision to raise the budget deficit target, which pushed yields higher from early November and increased perceived risk, and (2) elevated purchases of government bonds by Hungarian banks to reduce extra profit tax, which supported the demand side and helped stabilize yields.
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