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CEE MARKETS-FX extends gains, eyes on Polish July rate meeting

    BUDAPEST, June 28 (Reuters) - Central European currencies
edged marginally higher on Monday with the Polish zloty leading
the region, backed by last week's bout of tightening in Hungary
and the Czech Republic following the COVID-19 pandemic. 
    The Polish central bank has struck a more dovish tone but
some analysts see a potential pivot from it in July. Governor
Adam Glapinski said on Friday that exiting unconventional
monetary policy measures must be spread over time.
    He said the bank's asset purchase programme will be wound up
before it raises rates. Monetary Policy Council member Eryk Lon
said in an article on Monday that quick tightening of Polish
monetary policy could hinder economic recovery.
    Poland's main interest rate has been at a record low of 0.1%
since May 2020.
    By 0910 GMT, the zloty had edged up 0.12% to trade
at 4.5085 to the euro, followed by the Romanian leu
and the Hungarian forint with a 0.1 advance. The Czech
crown was virtually unchanged at 25.4650.    
    "On the front end (of the rates curve), more and more is
being priced in and three more hikes in 2021 is starting to look
like the base scenario in the eyes of the market," Komercni
Banka trader Marek Lesko said in a note.
    Central Europe has been facing stronger inflationary
pressures than the euro zone, putting central banks on alert.  
            CEE        SNAPSHOT   AT                       
            MARKETS              1110 CET           
                       CURRENCI                            
                       ES                           
                       Latest    Previous  Daily    Change
                       bid       close     change   in 2021
 Czech                  25.4640   25.4850   +0.08%   +3.00%
 crown                                              
 Hungary               350.9500  351.0500   +0.03%   +3.35%
 forint                                             
 Polish                  4.5090    4.5135   +0.10%   +1.11%
 zloty                                              
 Romanian                4.9265    4.9295   +0.06%   -1.25%
 leu                                                
 Croatian                7.4970    7.4973   +0.00%   +0.67%
 kuna                                               
 Serbian               117.5300  117.6050   +0.06%   +0.03%
 dinar                                              
 Note:      calculated from                1800            
 daily                                     CET      
 change Latest    Previous  Daily    Change
                                 close     change   in 2021
 Prague                 1161.84  1161.180   +0.06%   +13.11
                                        0                 %
 Budapest              48036.26  48461.47   -0.88%   +14.08
                                                          %
 Warsaw                 2265.71   2282.46   -0.73%   +14.20
                                                          %
 Bucharest             11959.87  11875.16   +0.71%   +21.97
                                                          %
 Ljubljana              1136.23   1137.00   -0.07%   +26.13
                                                          %
 Zagreb                 2004.56   2004.95   -0.02%   +15.25
                                                          %
 Belgrade   <.BELEX15    778.23    775.37   +0.37%   +3.96%
            >                                       
 Sofia                   555.80    556.03   -0.04%   +24.19
                                                          %
                                                           
                       Yield     Yield     Spread   Daily
                       (bid)     change    vs Bund  change
                                                    in
 Czech                                              spread
 Republic                                           
   2-year   <CZ2YT=RR    0.4930    0.0310   +114bp    +4bps
            >                                    s  
   5-year   <CZ5YT=RR    1.7100   -0.0380   +227bp    -3bps
            >                                    s  
   10-year  <CZ10YT=R    1.8230   -0.0050   +199bp    +0bps
            R>                                   s  
 Poland                                                    
   2-year   <PL2YT=RR    0.4020    0.0330   +105bp    +4bps
            >                                    s  
   5-year   <PL5YT=RR    1.4600   -0.0080   +202bp    +0bps
            >                                    s  
   10-year  <PL10YT=R    1.8320    0.0570   +200bp    +7bps
            R>                                   s  
            FORWARD                                        
                       3x6       6x9       9x12     3M
                                                    interba
                                                    nk
 Czech Rep          <      0.95      1.35     1.61     0.67
            PRIBOR=>                                
 Hungary            <      1.53      1.85     2.00     1.04
            BUBOR=>                                 
 Poland             <      0.37      0.63     0.86     0.21
            WIBOR=>                                 
 Note: FRA  are for ask prices                             
 quotes                                             
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 (Reporting by radu Marinas in Bucharest and Jason Hovet in
Prague; Editing by Timothy Heritage)
  
 
 
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