(Adds detail, fixed income)
PRAGUE, Aug 28 (Reuters) - Emerging European currencies
extended losses against the euro on Thursday as growth fears
continued to weigh on the region.
A recent rebound in the dollar has added to currencies'
falls in the past month, although concerns over slower growth,
along with any fallout from the Russian-Georgian conflict, have
also begun to drag on regional markets.
The forint <EURHUF=> slipped 0.8 percent by 0806 GMT to
237.6 per euro, stuck above the 236 level, and bond yields
jumped 10 basis points across the curve, tracking losses in the
currency, dealers said.
Hungary's forint fell on Wednesday after Prime Minister
Ferenc Gyurcsany, whose Socialists rule in a minority
government, said he would quit if parliament voted down his tax
reform bills and the budget in the autumn.
"I think once the excitement about the (tax package) dies
down, the forint can return to levels around 235," one dealer
said.
The Czech crown dropped to 24.72 per euro from Wednesday's
close of 24.56, and dealers expected more weakness after the
currency broke above the 24.6 resistance level with the next
level seen at 24.85.
The Polish zloty <EURPLN=> fell 0.4 percent to 3.347,
dropping with the region despite hawkish rhetoric from its
central bank on Wednesday after it left interest rates
unchanged.
Polish government bond yields stabilised on Thursday, after
rising across the board yesterday.
"It's stabilised now. Despite the hawkish comments, only one
(rate) hike is possibly on the cards," a bond dealer said.
Among other currencies in the region, Romania's leu
<EURRON=> edged down a touch to 3.55.
The Serb dinar <EURRSD=> fell 0.2 percent to 76.4 a euro,
while the Croatian kuna <EURHRK=> stood at 7.16 to the euro,
supported by corporate demand for the currency along with an
inflow of euros from tourism.
Central and eastern European currencies have fallen back
since hitting record highs in July, as the region is squeezed by
concerns over the Russian-Georgian conflict in the east and a
euro zone slowdown to its west.
*************************MARKET SNAPSHOT************************
Currency Latest Previous Local Local
close currency currency
change change
today in 2008
Czech crown <EURCZK=> 24.725 24.567 -0.64% +6.69%
Polish zloty <EURPLN=> 3.347 3.333 -0.42% +7.04%
Hungarian forint <EURHUF=> 237.640 235.700 -0.82% +6.02%
Croatian kuna <EURHRK=> 7.160 7.164 +0.06% +2.27%
Romanian leu <EURRON=> 3.557 3.542 -0.42% +0.65%
Serbian dinar <EURRSD=> 76.400 76.240 -0.21% +3.00%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
3-yr T-bond CZ3YT=RR +4 basis points to 3bps over bmk*
5-yr T-bond CZ5YT=RR -1 basis points to +6bps over bmk*
10-yr T-bond CZ10YT=RR +2 basis points to +34bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -1 basis points to +216bps over bmk*
5-yr T-bond PL5YT=RR -3 basis points to +205bps over bmk*
10-yr T-bond PL10YT=RR -3 basis points to +187bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR +9 basis points to +478bps over bmk*
5-yr T-bond HU5YT=RR +9 basis points to +452bps over bmk*
10-yr T-bond HU10YT=RR +10 basis points to +383bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1006 CET.
Currency percent change calculated from the daily domestic
close at 1500 GMT.
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(Reporting by Reuters bureaus, writing by Jason Hovet; editing
by Stephen Nisbet)
