CEE MARKETS 2-Currencies test key levels, data mixed

                                
 * FX edge up, bounce away from technical levels
                                
 * Zloty seen outperforming
                                
 * Czech trade shows surplus, Hungary's industry down yr/yr
                                
 
  (adds detail, quotes, fixed income)
                                
 By Marius Zaharia
                                
 BUCHAREST, July 7 (Reuters) - Central European currencies
edged up on Tuesday after data in the Czech Republic and Hungary
sent mixed signals but they stayed in tight ranges after a shift
in risk appetite failed to push them beyond key support levels.
                                
 The Czech Republic posted a marginally higher-than-expected
May trade surplus but showed both exports and imports continuing
to plunge by more than 20 percent, highlighting the depth of the
economic downturn [ID:nL7460725].
                                
 "The balance is improving, but what is important for the
Czech Republic is the dynamics of exports and imports, and both
fell significantly," said Radomir Jac from Generali PPF Asset
Management. "For the crown it is mixed news."
                                
 Hungary's industrial output fell more than the market
consensus on the year, but the overall figure still showed an
improvement versus the previous month [ID:nL7687288]. The forint
moved little on the data.
                                
 At 0933 GMT the Polish zloty <EURPLN=>, the Hungarian forint
<EURHUF=> and the Czech crown <EURCZK=> were up 0.3-0.5 percent,
slightly firmer from morning levels. Dealers said the units were
up on technical rather than fundamental reasons.
                                
 Romania's leu <EURRON=> fell 0.1 percent.
                                
 "There is a barrier at 4.40 for the zloty and at 275 for the
forint," one dealer in Bucharest said. "If they breach it, they
fall further, if not they will stabilise."
                                
 Dealers said the mood on the crown was also hurt after the
Finance Ministry said the 2009 budget deficit could hit around 5
percent of GDP -- from a previous 4.5 percent forecast --
following a wave of floods that have killed at least 13 people
and caused widespread damage to firms and houses. [ID:nL5671444]
                                
 "The crown got a negative impulse from the unceasing floods,
which will draw 7 to 10 billion crowns from the state coffers,
according to the official estimate," said David Sykora, a dealer
from CSOB.
                                
 
                                
 REPOSITIONING
                                
 Currencies hit multi-month highs last week during a rally
driven by encouraging regional data and an overall improvement
in global sentiment, but they suffered a correction on Monday as
the region's bourses fell.
                                
 A Reuters poll showed last week the region's major
currencies were still expected to weaken in the short-term, but
were seen firming over a 12-month period with the zloty leading
gains [ID:nL2228966].
                                
 ING bank recommended on Tuesday to sell leu/zloty six-month
forward contracts, as it expects the Romanian economy to shrink
further, and said the zloty was still cheap in comparison to
Poland's better fundamentals. [ID:nL7631883]
                                
 BNP Paribas on Monday recommended selling the Czech crown
against the euro, betting on further interest rate cuts as
exporters come under pressure from the unit's recent strength.
[ID:nL6236797]
                                
 While analysts see further monetary easing in Romania and
Czech Republic, a Reuters poll showed on Tuesday Poland was
expected to hold rates flat at least until September
[ID:nL7668536].
                                
 In other markets, Polish and Hungarian bonds were virtually
flat.
----------------------MARKET SNAPSHOT-------------------------
Currency                    Latest   Previous Local    Local
                                
                                  close    currency currency
                                
                                           change   change
                                
                                           today    in 2009 
Czech crown      <EURCZK=>  25.826   25.936  +0.43%    +3.59%
Polish zloty     <EURPLN=>   4.372    4.386  +0.32%    -5.88%
Hungarian forint <EURHUF=> 273.1    274.5    +0.51%    -3.5%
Croatian kuna    <EURHRK=>   7.331    7.32   -0.15%    +0.46%
Romanian leu     <EURRON=>   4.207    4.203  -0.1%     -4.58%
Serbian dinar    <EURRSD=>  92.967   93.163  +0.21%    -3.75%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond   CZ2YT=RR   +21 basis points to  162bps over bmk*
4-yr T-bond   CZ4YT=RR    -1 basis points to  +190bps over bmk*
8-yr T-bond   CZ8YT=RR   +6 basis points to  +310bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond   PL2YT=RR    -2 basis points to  +393bps over bmk*
5-yr T-bond   PL5YT=RR    0 basis points to  +332bps over bmk*
10-yr T-bond PL10YT=RR    -3 basis points to  +297bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond   HU3YT=RR    -3 basis points to  +793bps over bmk*
5-yr T-bond   HU5YT=RR   +4 basis points to  +721bps over bmk*
10-yr T-bond   HU10YT=RR +5 basis points to  +610bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1233 CET.
Currency percent change calculated from the daily domestic 
close at 1600 GMT.
                                
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 (Reporting by Reuters bureaus, writing by Marius Zaharia;
Editing by Victoria Main)