(Updates throughout, changes dateline)
BUDAPEST, Aug 19 (Reuters) - Emerging European currencies
closed mixed versus the euro on Tuesday with fresh gains in the
dollar erasing most of the gains posted earlier this week.
The biggest loser of the day, the Czech crown <EURCZK=> fell
0.7 percent in quiet trade, stabilising around 24.40 to the
euro, to give up the brunt of Monday's gains.
"It has been quiet. We've seen some buying interest from
London banks," a Prague-based currency trader said.
"The dollar is the main mover. All regional currencies are
losing against the dollar, and it will be similar in the coming
days," the trader said.
The euro is the main reference currency in central and
Eastern Europe, and dealers frequently make trading decisions
according to the dynamics of the euro/dollar pair.
Hungary's forint <EURHUF=> closed broadly unchanged,
surrendering modest gains posted earlier in the session.
"In part we still track the euro/dollar cross," said a
currency dealer in Budapest.
"There was some easing in the morning but now we are almost
back to yesterday's closing levels. Not much has happened today,
volumes were low and we kept ticking lower," the trader said.
She said the forint got a boost early on Tuesday from a
local bank selling euros after a brokerage note issued on Monday
recommended playing the Polish zloty against the forint.
The zloty <EURPLN=> ended the day unchanged at 3.32 versus
the euro and Romania's leu <EURRON=> also closed flat. Croatia's
kuna <EURHRK=> and the Serbian dinar <EURRSD=> ended the day a
shade stronger.
Hungarian government bond yields dropped by about five basis
points across the curve, retreating from early lows hit after
domestic gross wage growth data came in slightly above market
expectations.
Hungary's gross average wages <HUWAGE=ECI> grew by an annual
9.7 percent in June, picking up from 9.6 percent in May.
However, the data did not change analyst expectations that
the central bank would keep interest rates unchanged at 8.5
percent at its policy meeting next Monday.
"In the morning we opened a tad higher as (interest rate
swaps) jumped 5 basis points," said a fixed income trader in
Budapest.
"Then the forint began to firm, which shaved a few basis
points off on all maturities," the trader said. "However,
turnover is still extremely low and the market is very
illiquid," she said.
*************************MARKET SNAPSHOT************************
Currency Latest Previous Local Local
close currency currency
change change
today in 2008
Czech crown <EURCZK=> 24.39 24.21 -0.74% +7.95%
Polish zloty <EURPLN=> 3.32 3.32 0% +7.79%
Hungarian forint <EURHUF=> 235.55 235.9 +0.15% +6.84%
Croatian kuna <EURHRK=> 7.18 7.19 +0.14% +2%
Romanian leu <EURRON=> 3.52 3.52 0% +1.68%
Serbian dinar <EURRSD=> 76.7 76.9 +0.26% +2.62%
Czech treasury bonds <0#CZBMK=>
3-yr T-bond CZ3YT=RR +9 basis points to 1bps over bmk*
5-yr T-bond CZ5YT=RR +2 basis points to +5bps over bmk*
10-yr T-bond CZ10YT=RR -3 basis points to +25bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR +1 basis points to +460bps over bmk*
5-yr T-bond HU5YT=RR 0 basis points to +432bps over bmk*
10-yr T-bond HU10YT=RR -2 basis points to +459bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1635 CET.
Currency percent change calculated from the daily domestic
close at 1500 GMT.
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(Reporting by Reuters bureaus, Writing by Gergely Szakacs;
Editing by Gerrard Raven)
