Czech crown firmer, mkt looking at global trends

...domestic impulse and instead watching global trends.

At 0759 GMT, the crown traded at 28.235 , down from 28.266 at Wednesday's close.

"Fundamentals to influence the crown at home and in the region will be scarce. The market will be driven mainly by the global situation," said Jan Vejmelek of Komercni Banka.

Analysts said that worse than expected producer price data on Wednesday failed to impact the market, which is more and more convinced any change in rates will be put off by several months to either the second or third quarter.

Czech rates are the lowest in the EU at 2.5 percent, 100 basis points below euro zone rates.

The low Czech cost of money has led many investors to prefer to sell the crown for higher-yielding emerging markets assets, with the goal of capturing the interest rate spread.

Many analysts say the odds are strongly against the crown repeating its 6 percent rise against the euro from last year when it became the world's fourth best performing currency.

A widely-forecast rise in benchmark European Central Bank (ECB) rates to 3.75 percent in March [ECB/INT] is set to deepen the crown's yield disadvantage.

----------------- MARKET SNAPSHOT AT 0759 GMT ----------------- Crown/euro last deals at 28.235 (0.09 pct)

Crown/dollar at 21.559 bid (-0.18 pct)

5-year yield due Oct 2010 3.27 pct bid (-3 bps) 10-year yield due Jan 2016 3.73 pct bid (-2 bps)

5-yr CZK/EUR mid yield spread -76 bps (vs -73) 10-yr CZK/EUR mid yield spread -32 bps (vs -31)

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

[PRAGUE/Reuters/Finance.cz]