CEE MARKETS 2-Forint dips after rally, zloty unnmoved by GDP

                                
 * Forint off 2011 highs as markets correct
                                
 * Analysts turn wary of Hungary rally
                                
 * Zloty unmoved by Polish GDP data
                                
 
  (Updates Polish GDP, adds bonds)
                                
 PRAGUE, Jan 28 (Reuters) - The Hungarian forint slipped on
Friday from its 2011 high as investors booked profits after this
week's rally, while the Polish zloty was unmoved after
preliminary 2010 GDP data met market expectations.
                                
 The forint has jumped this week after successful bond
tenders and growing optimism about fiscal reforms promised by
the government that are to be unveiled in the coming weeks. 
                                
 After a 1 percent surge on Thursday to levels last sustained
in November, the forint slipped early in the session as the
euro, central Europe's reference currency, also dipped on
profit-taking.
                                
 "There is a bit of a correction so far today, but this could
be expected after such a rally," a Budapest dealer said.
                                
 Hungary's economy minister Gyorgy Matolcsy gave a boost to
the forint on Thursday when he said the government was preparing
"very serious" reforms aimed at fundamentally improving the
sustainability of the state budget by 2013-2014. [ID:nBUS002258]
                                
 But markets are turning slightly more cautious on the rally
in Hungarian assets. 
                                
 The forint <EURHUF=> dipped 0.2 percent to 271.8 to the euro
by 0933 GMT. Budapest stocks <.BUX> led losses among peers,
falling almost 1 percent on Friday along with the weaker wider
market.
                                
 Hungarian bond yields held steady after a rally this month
in the debt market.
                                
 "Because of large uncertainties surrounding future
development of the country's economy, we don't think that now is
the right time to put on Hungary risk for longer term
investors," SEB said in a daily trade note.
                                
 On Thursday, RBC Capital Markets recommended buying the
Polish zloty against the Hungarian forint <PLNHUF=R>, saying
interest rate tightening by Hungary's central bank has probably
ended, and there are risks the reform package may disappoint.
[ID:nLDE70Q1V1]
The zloty <EURPLN=> was also down 0.2 percent to bid at
3.907 to the euro. The Czech crown <EURCZK=> lost 0.3 percent
and the Romanian leu <EURRON=> inched up 0.1 percent.
                                
 
                                
 POLISH GDP, RATES
                                
 Poland's gross domestic product grew by 3.8 percent in 2010,
in line with expectations, according to preliminary data.
                                
 Data also showed investments in 2010 fell 2.0 percent
year-on-year while domestic demand rose 3.9 percent.
                                
 Most analysts had expected an acceleration in investments,
which would spur the zloty. The zloty was little moved by the
decline in investments.
"We are flat now but there's a tendency on the zloty to
weaken further as the Polish unit is under pressure," said Karol
Zaluski, chief FX dealer at ING bank.
                                
 Poland began a monetary tightening cycle this month that has
helped lift the zloty as much as 2 percent this year, although
the market is starting to bet on a pause already, dealers said.
                                
 After the GDP data, Polish central banker Anna
Zielinska-Glebocka told TVN CNBC on Friday that themonetary
policy council was likely to continue raising rates as
inflationary pressures will rise further. [ID:nWSF009932]
                                
 
--------------------------MARKET SNAPSHOT--------------------
Currency                    Latest   Previous Local    Local
                                
                                  close    currency currency
                                
                                           change   change
                                
                                           today    in 2011 
Czech crown      <EURCZK=>   24.232   24.152  -0.33%   +3.17%
Polish zloty     <EURPLN=>    3.907    3.9    -0.18%   +1.31%
Hungarian forint <EURHUF=>  271.8    271.37   -0.16%   +2.27%
Croatian kuna    <EURHRK=>    7.416    7.41   -0.08%   -0.49%
Romanian leu     <EURRON=>    4.259    4.263  +0.09%   -0.61%
Serbian dinar    <EURRSD=>  104.5    104.18   -0.31%   +1.37%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond   CZ2YT=RR    -8 basis points to  38bps over bmk*
7-yr T-bond   CZ7YT=RR    -1 basis points to  +65bps over bmk*
10-yr T-bond   CZ9YT=RR    -4 basis points to  +84bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond   HU3YT=RR   +2 basis points to  +512bps over bmk*
5-yr T-bond   HU5YT=RR   +4 basis points to  +463bps over bmk*
10-yr T-bond   HU10YT=RR +1 basis points to  +403bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1033 CET.
Currency percent change calculated from the daily domestic 
close at 1700 GMT.
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 (Reporting by Reuters bureaus, writing by Jason Hovet, editing
by Catherine Evans)