ING expects Czech and Polish rates to remain steady despite markets pricing in hikes, while Hungary may cut more than anticipated.
Central and Eastern European markets opened higher as rate markets priced in potential hikes, though FX movements remained limited. Current pricing suggests around two Czech National Bank (CNB) hikes over 18 months, slightly over one in Poland, and three cuts in Hungary.
ING strategists anticipate no change in Czech or Polish rates, while Hungary’s central bank may deliver more cuts than markets expect. Inflation data and this week’s CNB meeting could provide further support for rates, particularly if global conditions remain favorable.
The zloty and forint are expected to outperform, while the koruna may lag due to dovish expectations. Recent moves aligned with core markets, with minimal shifts in rate differentials.