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CEE MARKETS-Crown hits multi-year high, other units rebound on ECB

* Crown strongest since 2013, zloty and forint rebound

* Czech central bankers say rate hike in H2 remains on cards

* Markets cautious due to British vote, U.S. politics

* Serbian central bank keeps rates on hold, dinar eases

(Adds ECB comments, Hungarian bond auction, record high of Budapest Stocks, Serbian central bank decision) BUDAPEST/PRAGUE, June 8 (Reuters) - The crown led a rise of Central European currencies on Thursday, hitting its highest level since 2013, after Czech central bankers repeated that they could start raising rates later this year. Asset prices in Central European financial markets were mostly rangebound ahead of Thursday's British elections and the congressional testimony from ex-FBI director James Comey. The crown still firmed a quarter of a percent to 26.25 against the euro by 1347 GMT, touching its strongest levels since late 2013. The Czech central bank (CNB) could make its first interest rate rise in the second half of this year, Vice-Governor Mojmir Hampl said late on Wednesday. Another rate setter, Oldrich Dedek was quoted by the daily paper E15 as saying that he saw no reason to question the bank's staff forecast which suggests a third-quarter hike. The bank has repeatedly said that the more the crown firms from its firmer cap at 27 against the euro, which the bank removed in April, the less needed rate tightening could be. The crown has been slower to rise since being set free than many investors expected, leaving tens of billions of euros of positions built up before the exit still in the market. "We have our central bank story and big positions waiting to close. That is the story: when these positions will be closed," a Prague FX dealer said. Czech markets still price in a hike to come not earlier than the second quarter of 2018, Komercni Banka rates trader Dalimil Vyskovsky said. "I actually think (the market) is aware of the risks of much earlier rate hike, but it seems to be that people are positioned already," he said, adding that much will depend on the crown's gains and inflation developments. The CNB's 2-percent inflation target is lower than in Hungary or Poland. A hike would be the first in about a decade, and its tightening bias is in contrast with loose policy stances elsewhere in the region. Poland's central bank could keep rates at record lows until the end of 2018 because inflation is expected to stabilize, its governor reiterated on Wednesday. The zloty and the forint reversed an early weakening against the euro. The zloty returned to the firmer side of the 4.2 line as the euro eased versus the dollar, after the European Central Bank dropped its guidance that interest rates may be cut, but reiterated that quantitative easing could be extended if needed.

ECB asset buying in the euro zone has also created additional demand for Central European financial assets. Healthy demand led Hungary to sell 60 billion forints ($218.17 million) worth of government bonds at two auctions on Thursday, 50 percent more than planned, and Budapest's main stock index hit a record high. Serbia's central bank held its benchmark interest rate at 4 percent on Thursday for the 11th consecutive month, as expected. The dinar eased 0.1 percent to 122.55 against the euro.

CEE MARKETS SNAPSH AT 1547 CET

OT CURRENCIES

Latest Previo Daily Change

us

bid close change in

2017

Czech crown 26.250 26.310 +0.23 2.88% 0 5 % Hungary 307.85 308.19 +0.11 0.32% forint 00 50 % Polish zloty 4.1975 4.2002 +0.06 4.92%

%

Romanian leu 4.5660 4.5745 +0.19 -0.68%

%

Croatian kuna 7.4180 7.4045 -0.18% 1.85% Serbian dinar 122.45 122.42 -0.02% 0.73% 00 00 Note: daily calculated previo close 1800 change from us at CET

STOCKS

Latest Previo Daily Change

us

close change in

2017

Prague 1004.8 1005.6 -0.07% +9.04 8 2 % Budapest 35356. 35021. +0.95 +10.4 14 75 % 8% Warsaw 2336.3 2308.6 +1.20 +19.9 2 4 % 4% Bucharest 8664.5 8686.6 -0.25% +22.2 2 2 9% Ljubljana 790.22 793.09 -0.36% +10.1

2%

Zagreb 1829.3 1821.0 +0.46 -8.30% 1 0 % Belgrade 718.96 722.55 -0.50% +0.22

%

Sofia 677.62 681.10 -0.51% +15.5

5% BONDS

Yield Yield Spread Daily (bid) change vs change Bund in Czech spread

Republic

2-year -0.072 0 +065b +0bps

ps

5-year -0.115 0.051 +034b +6bps

ps

10-year 0.764 -0.025 +050b -3bps

ps Poland

2-year 1.896 -0.003 +262b +0bps

ps

5-year 2.625 0.02 +308b +3bps

ps

10-year 3.193 0.002 +293b +0bps

ps

FORWARD RATE AGREEMENT 3x6 6x9 9x12 3M

interb ank

Czech Rep <PR 0.34 0.41 0.48 0

IBOR=>

Hungary <BU 0.19 0.23 0.29 0.15

BOR=>

Poland <WI 1.76 1.7725 1.8025 1.73

BOR=>

Note: FRA are for ask quotes prices ********************************************************* ****

($1 = 275.0200 forints)

(Writing by Sandor Peto; Editing by Toby Chopra and Toby Davis)