Wires

CEE MARKETS-Forint, zloty lifted higher, stocks lose ground

PRAGUE, Oct 2 (Reuters) - Hungary's forint led central European currencies higher on Wednesday during a seesaw week, while further gloom from major world economies pushed the region's stock markets lower. The forint moved off a record low touched last week and Poland's zloty edged up before a central bank rate decision, with markets widely expecting it to maintain rates at 1.5%. "The baseline scenario still assumes monetary policy stability at least until the end of next year," Santander Bank Polska said in a note. Czech and Hungarian central banks both kept interest rates on hold last week amid a global easing bias as trade tensions ramp up and economies slow. However, central Europe's economies have so far been resilient, propped up by domestic demand that is keeping inflationary pressures up and putting policymakers into wait-and-see mode. Before the Polish rate decision, the zloty gained 0.1% to 4.379 to the euro. The zloty has drifted this week ahead of a European Court of Justice ruling on Thursday on whether a bank in Poland broke the law when it sold mortgages denominated in Swiss francs. A ruling favoring the homeowners could unleash lawsuits affecting Polish banking profits for years. Warsaw's blue-chip WIG20 fell 1.1% to lead the region's bourses down. Prague lost nearly 1%, falling with others after U.S. manufacturing activity tumbled. Among other currencies, Hungary's forint was bid at 334.75 to the euro, 0.3% up on the day and off a record low 336.28. The Czech crown edged up to 25.759. Dealers in Prague and Budapest both said the currencies were falling into ranges. The crown, though, is sitting near its strongest level since mid-August after the central bank (CNB) kept a rate hike debate alive at its meeting last week. "Although external factors will continue to keep the crown in check, we expect the Czech currency to appreciate moderately against the euro over the forecast horizon, not least due to the solid domestic economy and the more restrictive CNB relative to other central banks," Commerzbank said.

CEE MARKETS SNAPSHOT AT

1058 CET CURRENCIES

Latest Previous Daily Changebid close change in 2019EURCZK= Czech crown 25.7590 25.7880+0.11% -0.20%EURHUF= Hungary forint 334.7500 335.6800+0.28% -4.08%EURPLN= Polish zloty 4.3793 4.3844+0.12% -2.05%EURRON= Romanian leu 4.7495 4.7492-0.01% -2.01%EURHRK= Croatian kuna 7.4120 7.4125+0.01% -0.03%EURRSD= Serbian dinar 117.4000 117.4600+0.05% +0.77%Note: daily change calculated from 1800 CETLatest Previous Daily Changeclose change in 2019.PX Prague 1021.34 1031.2500-0.96% +3.53%.BUX Budapest 39913.28 40112.38-0.50% +1.98%.WIG20 Warsaw 2129.45 2152.50-1.07% -6.46%.BETI Bucharest 9490.70 9552.68-0.65% +28.54%.SBITOP Ljubljana 858.42 860.18-0.20% +6.73%.CRBEX Zagreb 1951.96 1953.77-0.09% +11.62%.BELEX15 Belgrade 752.67 753.51-0.11% -1.18%.SOFIX Sofia 565.67 569.32-0.64% -4.84%

BONDS

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

Czech Republic spread

CZ2YT=RR 2-year 1.2890 -0.0030+204bps +0bpsCZ5YT=RR 5-year 1.1020 -0.0880+189bps -9bpsCZ10YT=RR 10-year 1.3520 -0.0200+190bps -3bps

Poland

PL2YT=RR 2-year 1.5110 -0.0040+227bps +0bpsPL5YT=RR 5-year 1.7770 -0.0100+257bps -1bpsPL10YT=RR 10-year 2.0160 0.0080+256bps +0bpsFORWARD RATE AGREEMENT3x6 6x9 9x12 3M interbankCzech Rep 2.16 2.09 2.10

2.16

Hungary 0.28 0.33 0.37

0.00

Poland 1.73 1.72 1.68

1.72

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

(Reporting by Jason Hovet in Prague, Alan Charlish in Warsaw and Marton Dunai in Budapest; Editing by Alexander Smith)