* Romania leu supported, dealers suspect cbank
* Crown touches one-month high, other FX jump
* PGE shares jump in Warsaw debut
(Recasts with Romania, updates throughout)
By Balazs Koranyi and Jason Hovet
BUDAPEST/PRAGUE, Nov 6 (Reuters) - Romania's leu fought off
pressure on Friday caused by a likely delay in international
loan transfer to Romania, with dealers suspecting central bank
help, while the Czech crown extended gains to lead central
Europe higher.
The International Monetary Fund put off a review of
Romania's 20 billion euro rescue package until it forms a new
government, Romanian officials said. []
The fund demands that Bucharest pass laws including a
cost-cutting budget by Dec. 10 or risk postponement of a 1.5
billion aid tranche, crucial for it to shore up finances and
avert deeper recession.
"The leu has been undergoing small swings. It had a tendency
to weaken after the IMF announcement but later bounced back,
helped, I think, by central bank covert intervention," said one
dealer with a foreign bank in Bucharest.
The leu <EURRON=> was little changed around the 4.3 to the
euro level that it has clung to throughout the more than
month-long political squabbling. Dealers have suspected central
bank intervention during that time to protect the level.
The central bank has declined to comment on interventions.
On Friday, President Traian Basescu nominated Liviu Negoita,
a member of the president's former party, as the country's new
prime minister designate. Analysts have given the designate
little hope of support in an opposition-backed parliament.
Political uncertainty along with widening budget deficits
have started to weigh on a half-year market rally in central
Europe, although strategists expect currencies to move back to a
firming trend which started in the spring.[]
HIGHER SURPLUS
Central Europe's wide-open economies have struggled to get
out of recession as manufacturers have trouble winning back
foreign orders.
But a sharper drop in imports than exports led to larger
trade surpluses for the Czech Republic and Hungary in September.
[]
The data lifted currencies, which also took U.S. jobs data
in stride.
The Czech crown <EURCZK=> touched a one-month high in early
trade and bid up 0.6 percent at 25.72 to the euro by 1501 GMT,
extending gains from Thursday's central bank decision not to cut
rates further from an already record low level.
The decision caused some investors to unwind short bets.
[]
"There are three things (helping the crown): foreign trade
data, the central bank decision, and (President Vaclav) Klaus
signing the Lisbon Treaty," a Prague dealer said.
Interest rate swaps steadied after the short end jumped by
about 15 basis points on Thursday, with markets looking ahead to
next week's central bank minutes that will likely show if the
chance of a another interest rate cut had faded, dealer said.
The Hungarian forint <EURHUF=> and Polish zloty <EURPLN=>
gained around half a percent on the day. Stock markets in the
region slid around 1 percent.
In Poland, shares in utility PGE jumped as much as 14
percent on their Warsaw debut on Friday, Europe's largest
initial public offer (IPO) this year and a test for investor
interest in the region. []
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 25.72 25.885 +0.64% +4.02%
Polish zloty <EURPLN=> 4.24 4.266 +0.61% -2.95%
Hungarian forint <EURHUF=> 274.46 275.96 +0.55% -3.98%
Croatian kuna <EURHRK=> 7.262 7.261 -0.01% +1.42%
Romanian leu <EURRON=> 4.3 4.303 +0.07% -6.64%
Serbian dinar <EURRSD=> 93.7 93.79 +0.1% -4.5%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
3-yr T-bond CZ3YT=RR -7 basis points to 95bps over bmk*
7-yr T-bond CZ7YT=RR -3 basis points to +102bps over bmk*
10-yr T-bond CZ10YT=RR -3 basis points to +92bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1601 CET.
Currency percent change calculated from the daily domestic
close at 1700 GMT.
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(Reporting by Reuters bureaus; Writing by Balazs Koranyi/Jason
Hovet; Editing by Ruth Pitchford and Andy Bruce)
