Macro: COVID-19 CEE FX Update Part 6: Cautious recovery from the shock
Economic data paint a dire picture for both advanced and developing countries, while FX rates in CEE bounced back from an oversold positionWe remain cautious in the short-term but think that most currencies, with the possible exception of RUB, RON and TRY, will continue to recover somewhat until the end of June
With respect to the RUB, significant oil price volatility, the strong spread of the coronavirus and the dovish local central bank make us believe in a moderate recovery only in H2 2020
In addition, the TRY is increasingly under pressure due to a dovish central bank and weak FX reserves
Regarding the UAH, the local currency is trading close to our target value, but asymmetric risks are still present given that the IMF deal is not sealed yet
This Research was produced and first published by Raiffeisen Bank International AG which is supervised by the Austrian Financial Market Authority and the National Bank of Austria.
The Institutional Equity Research team of Raiffeisen Bank International AG covers 85 stocks from Austria, Central & Eastern Europe with sell-side research and thus levers our local broker status with excellent company relationships. For corporates in Austria, CEE and Western Europe, we offer co-sponsored research, which includes research coverage and marketing activities to investors. Additionally, through our Spotlight Research product we also shed light on leading European small and micro-caps, seeking greater visibility with investors.
The Institutional Equity Research team consists of roughly 15 analysts, both in Vienna and the CEE countries. Our analysts provide long-standing sector expertise in tandem with profound local market know how and a sectoral approach across the entire region.
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