CEE MARKETS 2-Currencies mixed, rates still in focus

                                
 * FX mixed, market eyes Poland's rate decision due Wednesday
                                
 * Hungarian bonds stronger after rate cut
                                
 * Polish row over IMF credit backstop not affecting mkt
                                
  
                                
 (Adds fixed income, detail)
                                
 WARSAW, March 30 (Reuters) - Central European currencies
were mixed on Tuesday with the focus on monetary policy after
Hungary and Romania cut borrowing costs on Monday and investors
eyed a Polish rate decision.
                                
 Dealers said an easing of immediate concerns over Greece,
which boosted the euro and investors' broad appetite for risk,
were supportive.
                                
 "Worries about Greece eased and have generally calmed
markets," said Elisabeth Andreew, FX analyst at Nordea.
                                
 By 0911 GMT the Polish zloty <EURPLN=> added 0.2 percent
against the euro, while the Czech crown <EURCZK=> and Hungary's
forint <EURHUF=> were flat. The Romanian leu <EURRON=> fell 0.2
percent.
                                
 Bonds in the region were also mixed, with Polish papers
stable and Hungary's stronger at the shorter-end of the curve.
The latter could continue to gain if the central bank continues
trimming borrowing costs, dealers said .
                                
 "The short end of the curve is stable, it's tracking the
rate cuts. The middle is also strong with continuous buying
interest, but the long end is a bit more volatile," one
Budapest-based trader said.
                                
 Romania and Hungary cut their interest rates to record lows
on Monday and signalled they were ready to do so again as
recovery across the region looked weaker than previously
expected. [ID:nLDE62S0OM]
                                
 The two countries were among the hardest hit during the
economic downturn in Central and Eastern Europe and both took
International Monetary Fund support.
                                
 Hungary is also facing an election this spring and dealers
said this would also weigh on the forint in coming months until
markets see the formation of a government and get a clear view
on policy.
                                
 In Poland the central bank's Monetary Policy Council (MPC)
began a two-day meeting on Tuesday with analysts widely
expecting it to leave rates at an all-time low of 3.5 percent on
Wednesday. 
                                
 The market expects two small rate rises later this year, but
analysts are unsure about the timing and more dovish comments
from the central bank on Wednesday could change the market view
on monetary tightening.
                                
 "The market is focused on the Polish rate decision tomorrow
-- particularly on comments from new MPC members since the
outcome is widely expected," Andreew said.
                                
 Poland's finance ministry and the central bank were at
loggerheads on Monday over whether Warsaw needed to extend a
flexible credit line, a credit backstop with the IMF, but that
was having little impact on the market. [ID:nLDE62S0YO]
[ID:nLDE62T0GP]
--------------------------MARKET SNAPSHOT--------------------
Currency                    Latest   Previous Local    Local
                                
                                  close    currency currency
                                
                                           change   change
                                
                                           today    in 2010 
Czech crown      <EURCZK=>  25.394   25.394      0%   +3.64%
Polish zloty     <EURPLN=>   3.874    3.881  +0.18%   +5.94%
Hungarian forint <EURHUF=> 265.06   265.02   -0.02%      +2%
Croatian kuna    <EURHRK=>   7.26     7.26       0%   +0.68%
Romanian leu     <EURRON=>   4.067    4.058  -0.22%   +4.19%
Serbian dinar    <EURRSD=>  99.72    99.4    -0.32%   -3.85%
Yield Spreads
Polish treasury bonds <0#PLBMK=>
2-yr T-bond   PL2YT=RR    -1 basis points to  +376bps over bmk*
5-yr T-bond   PL5YT=RR    -2 basis points to  +298bps over bmk*
10-yr T-bond PL10YT=RR    -2 basis points to  +240bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond   HU3YT=RR    0 basis points to  +465bps over bmk*
5-yr T-bond   HU5YT=RR   +1 basis points to  +403bps over bmk*
10-yr T-bond   HU10YT=RR +1 basis points to  +367bps over bmk*

Czech treasury bonds <0#CZBMK=>
3-yr T-bond   CZ3YT=RR    -7 basis points to  69bps over bmk*
7-yr T-bond   CZ7YT=RR   +5 basis points to  +100bps over bmk*
10-yr T-bond   CZ10YT=RR    0 basis points to  +91bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1111 CET.
Currency percent change calculated from the daily domestic 
close at 1600 GMT.
                                
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 (Reporting by Reuters bureaus, Writing by Dagmara
Leszkowicz; Editing by Susan Fenton)