Czech crown eases, eyes on rates meeting next week

                                
 PRAGUE, July 29 (Reuters) - The Czech crown eased on
Tuesday, with investors weighing chances of an interest rate cut
at the central bank's policy meeting next week.
                                
 The crown <EURCZK-> pulled back to 23.745 to the euro at
0900 GMT from Monday's regular trade close of 23.68, a 0.27
percent fall.
                                
 Dealers said the crown would likely remain weak until the
bank meets on Aug. 7, and could test the 24.00 per euro level
next week.
                                
 The Czech crown, along with peers the Polish zloty and
Hungarian forint, strengthened to record levels against the euro
in the past month.
                                
 However, Central Bank Governor Zdenek Tuma said a week ago
the crown, which gained 11.6 percent since the start of the
year, could push the bank to lower borrowing costs in order not
to undershoot its inflation target next year.
                                
 "Everybody is waiting (until the next meeting)," said trader
David Sykora at CSOB bank in Prague. "The crown could test 24.00
per euro ... but the market has found nice equilibrium."
                                
 Sykora estimated the crown to trade mainly within the
23.500-23.850 range this week, but said he was unconvinced the
bank would cut rates in August.
                                
 Expectations for a rate cut grew at the end of last week
after Vice-Governor Mojmir Hampl, the lone vote for a rate hike
at the last three meetings, said he would miss the August
session.
                                
 On Monday, bank board member Eva Zamrazilova hinted in an
interview with Dow Jones that a rate cut could be on the cards
next week.
 (Reporting Jason Hovet, editing by Mike Peacock)