* Weaker than expected wage data boosted bonds and zloty
* Monetary policy tightening may be delayed -Czech c.banker
* Call to change EU pension calculations may help region's
debt
(Adds Polish wages data, fresher prices)
By Jason Hovet and Dagmara Leszkowicz
PRAGUE/WARSAW, Aug 17 (Reuters) - Emerging Europe's
currencies were mixed on Tuesday, with the Polish zloty and
bonds up, as another raft of domestic data eased expectations
for quick move to higher interest rates.
The Polish statistics office data showed corporate wages
grew by an annual 2.1 percent last month, down from 3.5 percent
posted in June and much below analysts' expectations of a 3.7
percent rise.
Polish bonds strengthened after the data, with yields down
as much as 12 basis points across the curve, while the zloty
<EURPLN=> extended its moderate gains and was 0.3 percent
stronger at 1323 GMT.
"It looks like the Polish data were finally more important
(for investors) than the U.S. figures," said Jakub Wiraszka,
dealer at BRE bank in Warsaw. "Lower wages boosted appetite for
Polish debt and as a result lifted the zloty."
Wages data followed the inflation reading for July which
also suprised the market on the downside last week.
Analysts say weaker data should be an argument for dovish
member of the central bank's Monetary Policy Council (MPC), but
the market is still pricing in one interest rate hike by the end
of the year.
In the Czech Republic the central bank's governor Miroslav
Singer said the outlook for beginning policy tightening seemed
to be delayed. []
The Polish and Czech rates stand at their all-time lows of
3.5 percent and 0.75 respectively.
The Czech crown was 0.3 percent up versus the euro at 24.756
while Hungary's forint <EURHUF=> was 0.2 percent stronger and
Romania's leu <EURRON=> eased some 0.1 percent.
BONDS RALLY
The crown -- backed by fiscal tightening plans from the new
centre-right government -- has been a top performer in the
region this year. It has gained more than 6 percent, which is
twice the pace of the Polish zloty's appreciation.
Czech bond yields, which have touched lifetime lows on the
long end, ticked up slightly, while Hungarian yields continued
to rally downward by up to 18 basis points.
The debt agency sold more than planned in 3-month bills on
Tuesday at a lower yield than a previous sale, while the central
bank sold 2.299 trillion forints worth of two-week bills at a
weekly tender, bringing the total stock of bills to 3.888
trillion forints.
Some analysts said the recent call from nine European Union
countries, including Poland, Hungary, Czech Republic and
Romania, to exclude pension subsidies from debt calculations
could boost the region's debt.
"The news could support debt in those countries, but for me
it looks largely like a technical move and since the market is
still shallow, the effect (of the move) is immediate," said
Krzysztof Izdebski, dealer at PKO BP in Warsaw.
The European Commission said on Monday a call from nine
European Union countries to take into account pension reforms in
EU rules on budget accounting was relevant, and that it would
prepare a position on it soon. []
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2010
Czech crown <EURCZK=> 24.765 24.85 +0.34% +6.27%
Polish zloty <EURPLN=> 3.963 3.975 +0.3% +3.56%
Hungarian forint <EURHUF=> 278.8 279.3 +0.18% -3.03%
Croatian kuna <EURHRK=> 7.251 7.24 -0.15% +0.8%
Romanian leu <EURRON=> 4.235 4.232 -0.07% +0.06%
Serbian dinar <EURRSD=> 104.41 104.42 +0.01% -8.17%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond CZ2YT=RR -2 basis points to 111bps over bmk*
7-yr T-bond CZ7YT=RR -6 basis points to +111bps over bmk*
10-yr T-bond CZ9YT=RR -6 basis points to +114bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -4 basis points to +400bps over bmk*
5-yr T-bond PL5YT=RR -7 basis points to +381bps over bmk*
10-yr T-bond PL10YT=RR -18 basis points to +323bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR -21 basis points to +577bps over bmk*
5-yr T-bond HU5YT=RR -14 basis points to +531bps over bmk*
10-yr T-bond HU10YT=RR -14 basis points to +443bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1523 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
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(Reporting by Reuters bureaus, writing by Jason Hovet and
Dagmara Leszkowicz; editing by Stephen Nisbet)
