RPT-POLL-Czech crown seen at 27.8/euro in 3 mths,27.25 in 12

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The Czech crown is expected to trade at 27.80 per euro within three months, according to a Reuters poll taken between Aug. 14 and 15, before the currency's 1.1 percent jump on Thursday.

The crown rallied to 7-1/2-month highs around 27.50 per euro on Thursday, hitting levels which 14 market watchers in the poll did not forecast until after six months from now, according to the survey's median forecast.

"We have seen an abrupt and unexpected move in the crown, and precisely because it was abrupt and unexpected, I would consider it mad-brained to move my forecast all of a sudden," said Radomir Jac, chief analyst at PPF Asset Management.

"We may all be caught off guard by the crown firming faster than currently expected, but I stress the word 'may', we cannot obviously be sure yet," said Jac, who forecast the crown at 27.50 within six months and 27.00 within a year from now.

The poll painted a return to the crown's natural, long-term appreciation trend, as did previous monthly surveys, but failed to fully capture a reversal of largely risky bets in high-yield assets funded out of cheap crowns.

Czech rates, at 3 percent the lowest in the European Union, lured investors this year into using the crown along with the Japanese yen and the Swiss franc as a cheap vehicle for funding carry trades, aimed at profiting from high yields elsewhere.

The past month's distress in global credit markets has led investors to pare or liquidate risky positions across asset classes. That translated into heavy buying in the crown this week, highlighting the crown's safe-haven qualities [CZK/].

The crown has risen 2.1 percent over the past week, nearing a life-time high of 27.41 per euro, which the currency reached late last year and matched it again in early January.

The poll forecasts saw it rising to 27.25 in a year from now.

All forecasts in this month's survey shifted in favour of a slightly firmer crown compared with last month's poll. (For a TABLE with the poll results, click on [ID:nL16180722])

[PRAGUE/Reuters/Finance.cz]