* FX stronger boosted by better sentiment
* Poland's deficit may reach 6.5 pct of GDP, finmin says
* Czech data weak, finance minister stays
(Adds fixed income, detail)
By Dagmara Leszkowicz
WARSAW, Dec 14 (Reuters) - Emerging Europe's currencies
trimmed some gains made earlier on Monday but were still firmer
on the day, led by the Czech crown after surprise help for Dubai
revived market risk appetite.
At 1014 GMT, the crown <EURCZK=> had firmed 0.5 percent
against the euro. Poland's zloty <EURPLN=> gained some 0.4
percent, while Hungary's forint <EURHUF=> was up about 0.2
percent.
"Global stocks, including Asia, moved into the black and
sentiment has improved," said one Warsaw-based dealer.
Dubai said fellow United Arab Emirates member Abu Dhabi had
stepped in with a $10 billion injection, $4.1 billion of which
was allocated to property developer Nakheel to repay its Islamic
bond maturing on Monday. []
The news pushed global and local stocks higher, with
Warsaw's WIG20 <> leading gains, rising some 1.3 percent.
The region's currencies gave up some ground last week after
warnings from rating agencies over fiscal problems in countries
on the euro zone's periphery, including Greece.
An International Monetary Fund team was due in Romania to
discuss the 2010 budget plan and dealers said the market is
eyeing what measures the acting government will propose to the
IMF.
Romania's central election bureau said on Sunday a recount
of annulled votes in the country's presidential election had
failed to overturn centre-right incumbent Traian Basescu's
victory.
Basescu won the Dec. 6 runoff by around 70,000 votes against
leftist challenger Mircea Geoana, who contested the result at
the Constitutional Court saying the election was marred by
fraud. []
Romania's leu <EURRON=> gained some 0.2 percent to the euro.
DEFICIT WORRISOME
Poland's zloty led losses last week with a 2 percent fall
that was fuelled by data showing the current account gap
unexpectedly widened to 991 million euros. []
The country's Finance Minister Jacek Rostowski said the
general government deficit may reach 6.0-6.5 percent of gross
domestic product (GDP) this year. Analysts polled by Reuters
expect the deficit to stand at 6.2 percent. []
Poland is the only European Union member that has avoided
recession, but it is at risk of breaching national debt safety
levels that would automatically trigger painful fiscal
tightening.
In the Czech Republic, Finance Minister Eduard Janota agreed
to remain at the position after threatening to quit last week as
parliament approved next year's budget with changes that push
the public sector deficit to 5.9 percent of GDP. []
The Czech statistics office data showed retail sales fell by
4.7 percent in October, while industrial output dived 7.2
percent year-on-year in the same period. [].
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 25.713 25.838 +0.49% +4.04%
Polish zloty <EURPLN=> 4.144 4.159 +0.36% -0.7%
Hungarian forint <EURHUF=> 272.59 273.25 +0.24% -3.32%
Croatian kuna <EURHRK=> 7.274 7.276 +0.03% +1.25%
Romanian leu <EURRON=> 4.247 4.254 +0.16% -5.48%
Serbian dinar <EURRSD=> 95.77 95.89 +0.13% -6.57%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
3-yr T-bond CZ3YT=RR +1 basis points to 83bps over bmk*
7-yr T-bond CZ7YT=RR +2 basis points to +96bps over bmk*
10-yr T-bond CZ10YT=RR 0 basis points to +81bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR +1 basis points to +384bps over bmk*
5-yr T-bond PL5YT=RR +2 basis points to +338bps over bmk*
10-yr T-bond PL10YT=RR +2 basis points to +304bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR +1 basis points to +555bps over bmk*
5-yr T-bond HU5YT=RR +2 basis points to +500bps over bmk*
10-yr T-bond HU10YT=RR +2 basis points to +442bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1014 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 Ruth Pitchford)
