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CEE MARKETS-Forint lingers near 2018 lows as central bank meets

* Forint steadies after fall, central bank seen holding fire May reaffirm dovish bias as Fed's Powell awaited

* Investors also eye Italian election, German SPD vote

BUDAPEST, Feb 27 (Reuters) - The forint steadied near 2018 lows against the euro on Tuesday ahead of the outcome of a meeting of the Hungarian central bank at which it is expected to affirm its loose policy stance. After dipping to 313.88 per euro, its weakest level since Dec. 18, the forint traded at 313.6 at 0925 GMT, returning to Monday's closing levels. Central Europe's main currencies changed little as investors awaited the first appearance before lawmakers later in the day of new Federal Reserve Chairman Jerome Powell. His policy guidance could affect currencies in the European Union's eastern wing either by triggering flows into the dollar or affecting the euro/dollar cross, with a firming euro also strengthening the region's currencies, traders said. "Regarding the euro, event risk is too big ahead of the weekend, with the Italian elections and the SPD party vote on the (planned) German government coalition looming," one Budapest-based dealer said. Hungarian government bonds were also treading water, with the central bank unlikely to change interest rates though it could reaffirm its dovish policy bias, traders said. "I do not expect any significant impact even though the bank might try to weaken the forint a bit further with its message," the dealer said, adding that the forint's underperformance in the region in the past week may have been overdone. Figures on Tuesday showed a record low 3.8 percent unemployment rate in Hungary for the November-January period, signalling that a labour shortage could continue to boost wages, and investments to improve efficiency amid economic growth, analysts said. Budapest's main stock index bucked a modest rise in the region's main bourses, declining 0.3 percent, driven lower Richter said its 2017 net profit will significantly fall behind plan. In Warsaw, the stocks of Pekao rose by 3.6 percent, after Poland's second-biggest bank reported a surge in fourth-quarter earnings and said it would spend all its 2017 and 2018 profits on paying dividends. Polish banks have reported solid results for the fourth quarter of 2017 so far as the accelerating economy and social transfers boosted salaries and appetite for credit.

CEE SNAPSHOT AT MARKETS 1025 CET

CURRENCI ES

Latest Previous Daily Change bid close change in 2018 Czech <EURCZK= 25.3770 25.3760 -0.00% +0.65% crown > Hungary <EURHUF= 313.6000 313.6300 +0.01% -0.86% forint > Polish <EURPLN= 4.1690 4.1708 +0.04% +0.18% zloty > Romanian <EURRON= 4.6565 4.6578 +0.03% +0.50% leu > Croatian <EURHRK= 7.4460 7.4535 +0.10% -0.21% kuna > Serbian <EURRSD= 117.9700 118.0600 +0.08% +0.45% dinar > Note: calculated from 1800 CET

daily change

Latest Previous Daily Change close change in 2018 Prague 1105.78 1101.470 +0.39% +2.56%

0

Budapest 38504.83 38620.84 -0.30% -2.22% Warsaw 2417.87 2408.63 +0.38% -1.76% Bucharest 8397.76 8379.01 +0.22% +8.31% Ljubljana <.SBITOP 812.41 809.46 +0.36% +0.75% > Zagreb 1827.53 1828.95 -0.08% -0.83% Belgrade <.BELEX1 752.85 753.76 -0.12% -0.91%

5>

Sofia 685.13 686.16 -0.15% +1.13%

BONDS

Yield Yield Spread Daily (bid) change vs Bund change

in

Czech spread

Republic

2-year <CZ2YT=R 0.7210 0.1270 +123bps +10bps

R>

5-year <CZ5YT=R 1.2670 0.0040 +122bps -2bps

R>

10-year <CZ10YT= 1.9530 0.0420 +128bps +2bps

RR> Poland

2-year <PL2YT=R 1.6700 0.0050 +217bps -2bps

R>

5-year <PL5YT=R 2.6660 0.0060 +262bps -2bps

R>

10-year <PL10YT= 3.3970 0.0010 +272bps -3bps

RR>

FORWARD RATE AGREEMEN

T

3x6 6x9 9x12 3M

interban k

Czech Rep 0.98 1.08 1.24 0.91

<PRIBOR=

>

Hungary 0.07 0.11 0.18 0.02 Poland 1.76 1.77 1.86 1.72

Note: FRA are for ask prices quotes

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(Reporting by Sandor Peto; editing by John Stonestreet)