The zloty continues to strengthen

The zloty continues to strengthen, helped by the SNB's intervention Thursday, a Pekao dealer says. However, adds the trend had started earlier. "If the PLN doesn't come back to 4.55 level against the euro, it will target 4.32 mid-term," he says, adding Pekao forecasts EUR/PLN at 4.00 by the year-end. EUR/PLN now trades at 4.4644 from 4.5420 late Thursday. Friday, it's expected to trade within 4.40-4.43 range.

Turkish bonds and the Lira are weaker

Turkish bonds and the Lira are weaker, tracking losses in the opening of major European bourses. USD/TRY trades at 1.7640 from 1.7420 Wednesday; while the benchmark November 3, 2010 bond trades at 15.14% from 15.05% Wednesday. Analysts say USD/TRY falling below 1.7000 is not likely before the local elections March 29. They expect TRY to trade between 1.7410 and 1.7830, and the benchmark bond between 15.1% and 15.25% in the short term.

Bond futures contracts are mixed Wednesday

Bond futures contracts are mixed Wednesday as gilts again outperform their European counterparts ahead of the BOE's first reverse auction. Bunds opened lower as European equity markets took their lead from gains on Wall Street Tuesday. Supply pressures added to the negative tone. Germany's EUR8.0B 2-year Schatz auction was covered 2.1 times, before attention turned to the US Treasury's USD18.0B 10-year note auction later Wednesday.. At 1100 GMT, June bunds were down 0.62 at 123.87, within a 123.76-124.52 range. The June Euribor contract was up 0.015 at 98.48. Gilts hovered close to unchanged in cautious trading as the BOE's GBP2.0B buyback loomed. Full results of the operation are expected some time after 1445 GMT. At 1100 GMT, June gilts were up 0.11 at 124.10, within a 123.79-124.32 range. June short sterling was up 0.05 at 98.36. The forex market replayed Tuesday's trading pattern with the dollar giving up overnight gains as equities once again headed north. EUR/USD nudged higher throughout the session back to 1.2750 after falling to 1.2616 in Asia after China's trade balance suffered a dramatic deterioration with exports down 25.7% year-on-year. Sterling trade is cautious ahead of the first BOE QE gilt auction, the pound remains heavy against the euro but manages to add over one cent to $1.3820. Once again JPY is left on the sidelines with USD/JPY unchanged at 98.40. Elsewhere oil is holding just above $45bbl, DAX and CAC-40 are up 1%, FTSE 100 is down 0..4%, 3-month USD, euro and sterling libors fell.

USD/IDR ends slightly lower

USD/IDR ends slightly lower at 11,990 vs 12,070 Friday close (market closed Monday for public holiday) as offshore investors buy short-term Bank Indonesia paper, government bonds, lured by their high yields, dealers say. "The dollar's slide versus other regional currencies also helped push the dollar-rupiah lower," a dealer says; adds foreigners likely bought 1-year  note sold by government today at 10.42% yield; 11,950-12,050 range tipped Wednesday.

The latest IMM speculative positioning data

The latest IMM speculative positioning data show cumulative net USD longs at their highest since mid November, notes Rabobank. Breaking the numbers down the bank says euro shorts were at 3-month highs ahead of last week's ECB rate cut, JPY longs were parred for a fourth-straight week to levels seen last September. Sterling shorts were pared for the sixth-straight week ahead of the latest BOE rate cut while net CHF shorts made 3-month highs despite EUR/CHF's fall to 5 month lows.

The yield on the benchmark Colombian local

The yield on the benchmark Colombian local sovereign debt maturing 2020 rose after the consumer price index increased by a higher-than-expected rate in February.   The yield on the benchmark 2020 domestic paper ended at 9.660% Friday, up from 9.530% on Thursday, with pension funds and large banks selling TES bonds.   Inflation was 0.84% in February, propelled by increased educational costs. The figure was higher than the median average of 0.74% derived from a poll of  seven analysts conducted by Dow Jones Newswires.   "What is really worrisome is that core inflation is not declining at the pace we expected," said Camilo Arenas, an analyst at local brokerage Serfinco.   Inflation over the 12 months through February, however, fell to 6.47%, down from 7.18% in January.   February's consumer price index may force the central bank to cut rates by 0.25 percentage point during its next monetary meeting in late March and not 0.50 percentage point as some expected, said Laura Cabrera, analyst at local brokerage Acciones de Colombia.   "We initially expected the central bank would cut rates by 50 basis points but with this data we believe it will ease its monetary policy by just 25 basis points," she added.   On February, the central bank cut rates by a higher-than-expected one percentage point to 8%.   In the equity market, the benchmark IGBC stock index rose 0.7% to 7,695.84 points in part on the gain by state-controlled oil company Ecopetrol (ECOPETROL.BO).   Ecopetrol rose 1% to COP2,075 as oil futures rose to close $2.05 higher at $45.65 a barrel, a level not seen since January 27. Ecopetrol traded about half of Friday's total volume in the Colombian stock exchange.   On the foreign exchange market, the peso appreciated to COP2,556 against the dollar, from COP2,568,20 Thursday.   The peso gained as corporations sold dollars to take advantage of the  recent peso weakening, said Alexander Cardenas, head of research at local brokerage Acciones y Valores. On Tuesday, the peso ended above the COP2,600 threshold for the first time since June 2006.