Zloty in Longest Losing Streak Since August, Forint Drops on Oil

The Polish zloty had its longest streak of declines since August and the forint slipped to the weakest in more than three weeks as Libya’s uprising pushed the price of oil toward $100 a barrel in New York.

The zloty declined 0.3 percent to 3.9772 per euro as of 4:15 p.m. in Warsaw, the lowest level since Dec. 29. The Hungarian forint dropped 0.3 percent to 273.60 against the common European currency, its fourth day of losses.

Crude for April delivery climbed as high as $97.97 a barrel in New York after Libyan leader Muammar Qaddafi vowed to keep fighting the rebellion in the country, Africa’s third-biggest oil supplier. Stocks retreated.

“With all central and east European countries being net oil importers, the adverse economic impact of oil prices will quickly be felt via deterioration in the current account,” Elisabeth Gruie, an emerging-market strategist at BNP Paribas SA in London wrote in a report to clients. “The zloty would be most at risk from a sustained rally in oil prices.”

Poland’s current account deficit nearly doubled from a year earlier to 1.57 billion euros ($2.16 billion) in December as faster economic growth boosted demand, the central bank said on Feb. 11.

BNP is recommending investors buy the euro against “the basket” composed 50 percent of the zloty, and 25 percent each the forint and the Czech koruna, according to the report.

To contact the reporter on this story: Piotr Skolimowski in Warsaw at pskolimowski@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

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