Czech crown steady at stronger side of 28 vs euro

...week's interest rate-setting meetings of regional central banks to offer the market any new direction.

The crown was flat at 27.965 per euro by 1500 GMT. It was slightly weaker from last Friday after giving up gains made at the start of the week following an 8.5 percent revaluation of the neighbouring Slovak crown's euro peg.

"Current levels are not far from our fundamentally based exchange rate, which is the reason for our current neutral stance on EUR/CZK," analysts at Komercni Banka said in a report.

"The regional development driven by the SKK should continue to be the main short-term EUR/CZK determinant," they said.

The Slovak central bank is widely expected to cut interest rates by 50 basis points on Tuesday to offset the strength of its currency [ID:nL23653755], which Prague analysts said could spark a round of selling in both Czech and Slovak crowns.

The two crowns' exchange rates against the euro have been the most correlated pair in central Europe, reflecting deep economic integration between the two economies.

The Czech central bank (CNB) is due to meet on Thursday but policymakers are expected to hold rates steady for the sixth month running [CNB/INT].

Analysts said they would eagerly scan the CNB's post-meeting news conference for any clues about the timing of a next rate move which markets widely expected to be a hike.

----------------- MARKET SNAPSHOT AT 1457 GMT ----------------- Crown/euro last deals at 27.965 (-0.01 pct) Crown/dollar at 21.016 bid (-0.46 pct)

5-year yield due Oct 2010 3.33 pct bid (flat) 10-year yield due Jan 2016 3.80 pct bid (2 bps)

5-yr CZK/EUR mid yield spread -65 bps (vs -61) 10-yr CZK/EUR mid yield spread -18 bps (vs -16)

Current levels versus prior domestic close at 1500 GMT ---------------------------------------------------------------