* FX steady, awaits impulse from stocks
* Market eyes Hungary's bond auction due 0930 GMT
* Region's bonds market seen to recover slowly
(Adds fresher quote, fixed income)
WARSAW, April 23 (Reuters) - Central Europe's currencies
hovered around their previous closing levels on Thursday, with
the forint edging higher before Hungary's first bond auction in
two months as it restarts regular debt sales.
The forint <EURHUF=> was up 0.2 percent to bid at 296.5 to
the euro by 0848 GMT, and the Polish zloty <EURPLN=> was
slightly weaker at 4.41 per euro.
The Czech crown was 0.1 percent weaker at 26.92 versus the
common currency, while Romania's leu <EURRON=> was little
changed at 4.24.
Dealers said a rise in stocks lent support as regional
markets opened stronger on Thursday with Budapest's BUX <>
leading with a 1 percent rise. "With stocks gaining overnight,
emerging currencies were also looking positive this morning," a
dealer said.
Currencies have also stabilised this week after see-sawing
last week. The zloty has pulled back 2.6 percent against the
euro in the past week after jumping on news that Poland would
seek an IMF flexible credit line.
The forint has lost 1.6 percent in that time and the crown
only a half of percent.
One Warsaw-based dealer said currencies in the region are
likely to move in a range today, with impulses mainly from
shares. "It is nothing but stock markets now, especially now
that results season is on the way," he said.
BONDS IN FOCUS
Hungary plans to relaunch bond auctions on Thursday,
offering 15 billion forints' worth of paper after a global
pickup in risk appetite helped central Europe's hard-hit markets
rebound from lows in February.
"I expect good demand, they will be able to sell it easily,
with yields below current secondary market levels," said one
Budapest-based dealer.
The results of the auctions are due at 0930 GMT.
Hungary has managed just one bond auction since October when
it was forced to seek an IMF lifeline to keep its finances
afloat, and its bond market has been almost frozen since then.
But yields have come down by about 200 basis points on some
paper in the past month as the Hungarian debt agency has bought
back hundreds of billion forints' worth of bonds.
Poland's euro ambitions, a supporting factor in the past
month, hit a bump on Wednesday when the statistics office said
the general government deficit exceeded the EU's 3 percent
ceiling last year.[]
"The bonds market did not react on the news as investors are
not expecting good news (about the budget)," said one
Warsaw-based dealer. "I assume not many will be surprised when
the guvernment revises budget law."
The Czech bond market was also quiet, but dealers expected
yields to move further down after easing in the past month as
more investors take on risk, while expectations of a Czech
eurobond issue takes pressure off local issues.
The Czech's Finance Ministry sold more of its 10-year bond
than planned at an auction on Wednesday, and yields dipped from
the paper's inaugural sale last month in response to euro bond
plans, although details of the issue are not yet known.
[]
----------------------MARKET SNAPSHOT-------------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 26.917 26.885 -0.12% -0.61%
Polish zloty <EURPLN=> 4.412 4.403 -0.2% -6.73%
Hungarian forint <EURHUF=> 296.57 297.07 +0.17% -11.13%
Croatian kuna <EURHRK=> 7.42 7.38 -0.54% -0.74%
Romanian leu <EURRON=> 4.241 4.243 +0.05% -5.34%
Serbian dinar <EURRSD=> 93.95 93.61 -0.36% -4.76%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond CZ2YT=RR -2 basis points to 176bps over bmk*
4-yr T-bond CZ4YT=RR +10 basis points to +194bps over bmk*
8-yr T-bond CZ8YT=RR 0 basis points to +284bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -7 basis points to +403bps over bmk*
5-yr T-bond PL5YT=RR -5 basis points to +344bps over bmk*
10-yr T-bond PL10YT=RR -5 basis points to +293bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR -27 basis points to +879bps over bmk*
5-yr T-bond HU5YT=RR -63 basis points to +825bps over bmk*
10-yr T-bond HU10YT=RR -51 basis points to +730bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 0948 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
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(Reporting by Reuters bureaus, Writing by Dagmara
Leszkowicz; editing by David Stamp/Victoria Main)
