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CEE MARKETS-Demand surges at debt sales, political risks weighs on currencies

* Debt auctions draw strong demand, Trump comments on rates help

* Polish, Hungarian bond yields near multi-month lows on Trump

* Political uncertainties weigh on currencies

(Recasts with debt auctions) BUDAPEST, April 13 (Reuters) - Government debt auctions in Budapest, Bucharest and Prague drew robust demand on Thursday after U.S. President Donald Trump signaled that he wanted interest rates to stay low. Hungarian and Polish government bonds traded near multi-month lows. Czech two-year bonds bucked the trend despite huge over-subscription at an auction of 115-day Treasury bills. Yields were bid at minus 0.01 percent, up 7 basis points. The government sold 16.3 billion crowns ($649.27 million)worth of the bills at an average yield of -0.5 percent, well above the original planned maximum 5 billion crowns, with demand at 19.1 billion crowns. One trader said some foreigners who bought short-term Czech bonds earlier, betting on a surge of the crown, are rolling those positions over into even shorter bills. The central bank a week ago removed its cap on the value of the crown, which had kept the currency weaker than 27 per euro since 2013. The crown traded at 26.721 at 1232 GMT, a shade weaker from Wednesday and only slightly stronger than the old cap, despite bets by investors who bought tens of billions of euros worth of crowns hoping for a surge beyond 26. "I would not want to be in (the long-crown) people's skin right now," one Prague trader said. "One loses nerve, then a second and a third, and there could be quite a mess." Elsewhere, Romania sold a planned 600 million lei worth of five-year bonds, with the average yield falling to 2.77 percent from 3 percent in a sale five weeks ago. Yields at Hungary's two bond auctions fell below secondary market levels even though the government sold debt worth 70.8 billion forints ($240.90 million), well above the 45 billion forint planned. The forint, meanwhile, touched one-month lows. Trading at 312.61 against the euro, it was down 0.1 percent. Geopolitical risks are also in investors' minds, including Sunday's Turkish referendum about presidential power and France's upcoming elections. "We are also getting calls from foreigners enquiring about the demonstrations in Budapest," one dealer said. Tens of thousands protested in the past days in the Hungarian capital against government plans to tighten legislation over non-governmental organizations and a university founded by financier George Soros. Concern over politics may influence the forint, but the strong demand for bonds shows limited market impact. "It may get worse if there is escalation to a conflict with the European Union," the trader said.

CEE SNAPS AT 1432 MARKETS HOT CET

CURRENCIES Lates Previ Daily Chang

t ous e bid close chang in e 2017 Czech crown 26.72 26.70 -0.05 1.07% 10 65 % Hungary 312.6 312.3 -0.07 -1.21 forint 100 950 % % Polish 4.247 4.246 -0.02 3.68% zloty 5 8 % Romanian 4.519 4.517 -0.04 0.34% leu 6 8 % Croatian 7.426 7.438 +0.1 1.74% kuna 0 5 7% Serbian 123.5 123.6 +0.1 -0.16 dinar 500 950 2% %

Note: daily calculate previ close 1800

change d from ous at CET

STOCK S Lates Previ Daily Chang

t ous e

close chang in

e 2017 Prague 974.5 983.6 -0.93 +5.7 0 1 % 4% Budapest 32516 32409 +0.3 +1.6 .16 .94 3% 0% Warsaw 2220. 2214. +0.2 +13. 18 06 8% 98% Bucharest 8239. 8217. +0.2 +16. 59 83 6% 30% Ljubljana 778.4 779.4 -0.13 +8.4 2 1 % 8% Zagreb 1901. 1903. -0.10 -4.69 35 28 % % Belgrade <.BELEX15 732.0 734.4 -0.33 +2.0 > 9 8 % 5% Sofia 655.6 656.5 -0.14 +11. 5 9 % 80%

BONDS Yield Yield Sprea Daily d

(bid) chang vs chang e Bund e in Czech sprea Republic d 2-year <CZ2YT=RR -0.01 0.071 +085 +9bp > 3 bps s 5-year <CZ5YT=RR 0.277 0.019 +080 +3bp > bps s 10-year <CZ10YT=R 1.023 -0.05 +084 -4bps R> 1 bps

Poland

2-year <PL2YT=RR 2.002 -0.00 +286 +1bp > 7 bps s 5-year <PL5YT=RR 2.87 -0.01 +339 +0bp > 9 bps s 10-year <PL10YT=R 3.393 -0.04 +321 -3bps R> 7 bps FORWARD RATE AGREEMENT 3x6 6x9 9x12 3M

inter bank

Czech Rep < 0.3 0.32 0.4 0

PRIBOR=>

Hungary < 0.2 0.27 0.33 0.16

BUBOR=>

Poland < 1.77 1.785 1.795 1.73

WIBOR=>

Note: FRA are for quotes ask

prices

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************ ($1 = 25.1050 Czech crowns) ($1 = 293.9000 forints)

(Aditional reporting by Jason Hovet and Robert Muller in Prague, editing by Larry King)