CEE MARKETS-Dollar weakness gives currencies a boost

    By Alan Charlish
    WARSAW, Sept 1 (Reuters) - Central European currencies
firmed on Tuesday, as FX markets paid little attention to
regional manufacturing surveys and focused on the weakening
dollar instead.
    The dollar has been hit by fears about the pace of economic
recovery and uncertainty ahead of the U.S. presidential election
in November. The Federal Reserve's new approach to focus more on
average inflation and higher employment has also encouraged
traders to sell the greenback.
    "EUR/USD is close to 1.20, but other risky currencies are
also benefiting from the outflow of capital from the safe haven
of dollars," Konrad Bialas, chief economist at DM TMS Brokers,
said in a note.
     "The appetite for risk reigns supreme."
    At 0923 GMT the Czech crown was 0.27% stronger
against the euro at 26.192, the Hungarian forint was
0.11% firmer at 355.15 and the Polish zloty was 0.09%
firmer at 4.392. The Romanian leu leu was little
changed at 4.8395.
    In Prague, a dealer said the gains were mainly a correction
from end-of-month weakening.
    PMI data showed a mixed picture of the region's recovery,
with Czech manufacturing sentiment improving more than expected
but remaining in contraction, while in Hungary, the PMI rose,
with most components of the business survey showing modest
increases.
    In Poland the reading showed the recovery in the country's
manufacturing sector slowing.
    "We had PMI data, lower than the market expected but so far
the impact on the zloty was limited," said a Warsaw-based
currency trader.
    Polish 10-year yields fell just over 1 basis point to
1.381%. On Monday, the Polish Finance Ministry announced that it
will hold two switch tenders in September, at which it will buy
back bonds due in 2020 and 2021.
    "This shows that in a situation of high overliquidity (the
Ministry of Finance has accumulated 125 billion zlotys on the
central account), the priority will be to pre-finance next
year's borrowing needs," PKO BP analysts said in a note.
    In the Czech Republic, 10-year yields were little changed at
1.113%.
    Stocks were lower, in contrast to the broader European
market which posted gains, with the Stoxx 600 rising
around 0.2%.
    At 0923 GMT the main index in Budapest was down 0.45%
and Warsaw's WIG 20 was down 0.73%.
    "Since yesterday, and in fact since last week, our stock
market is significantly weaker than foreign markets, especially
core markets," said Bartosz Kulesza, an analyst at Pekao in
Warsaw, adding that Tuesday's lower-than-expected Polish PMI
could be a factor.
    
    
    
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1123              
                                     CET               
                                                              
                   CURRENC                                    
                   IES                                 
                            Latest   Previou  Daily    Change
                                     s                 
                            bid      close    change   in 2020
 EURCZK  Czech     <EURCZK  26.1920  26.2630   +0.27%   -2.90%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  355.150  355.530   +0.11%   -6.76%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.3920   4.3958   +0.09%   -3.09%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.8395   4.8392   -0.01%   -1.06%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.5280   7.5285   +0.01%   -1.10%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.500  117.600   +0.09%   +0.06%
 =       dinar     =>             0        0           
         Note:     calculated from            1800            
         daily                                CET      
         change                                        
                                                              
                   STOCKS                                     
                            Latest   Previou  Daily    Change
                                     s                 
                                     close    change   in 2020
 .PX     Prague              903.85  903.490   +0.04%  -18.98%
                                           0           
 .BUX    Budapest           34694.2  34851.2   -0.45%  -24.71%
                                  6        9           
 .WIG20  Warsaw    <.WIG20  1787.04  1800.21   -0.73%  -16.89%
                   >                                   
 .BETI   Buchares           9008.98  8997.28   +0.13%   -9.71%
         t                                             
 .SBITO  Ljubljan  <.SBITO   846.38   848.89   -0.30%   -8.58%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  1623.13  1617.09   +0.37%  -19.54%
                   >                                   
 .BELEX  Belgrade  <.BELEX   690.70   693.80   -0.45%  -13.84%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   434.49   434.21   +0.06%  -23.52%
                   >                                   
                                                              
                   BONDS                                      
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
                                                       in
         Czech                                         spread
         Republic                                      
 CZ2YT=    2-year  <CZ2YT=   0.1510  -0.0200   +080bp    -3bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   0.6880  -0.0450   +131bp    -6bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   1.1130   0.0020   +149bp    -2bps
 =RR     10-year   =RR>                             s  
         Poland                                               
 PL2YT=    2-year  <PL2YT=   0.1480   0.0000   +080bp    -1bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   0.7400  -0.0150   +136bp    -3bps
 RR                RR>                              s  
 PL10YT            <PL10YT   1.3810  -0.0110   +176bp    -3bps
 =RR     10-year   =RR>                             s  
                                                              
                   FRA                                        
                            3x6      6x9      9x12     3M
                                                       interba
                                                       nk
         Czech     <CZKFRA     0.37     0.39     0.43     0.34
         Rep       ><PRIBO                             
                   R=>                                 
         Hungary   <HUFFRA     0.79     0.87     0.93     0.62
                   ><BUBOR                             
                   =>                                  
         Poland    <PLNFRA     0.24     0.24     0.25     0.23
                   ><WIBOR                             
                   =>                                  
         Note: FRA quotes are for                             
         ask prices                                    
         ********************************************         
         ******************                            
                                                              
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 (Reporting by Alan Charlish in Warsaw and Jason Hovet in
Prague; Editing by Ramakrishnan M.)
  

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