* FX mostly off previous losses, moves on EURUSD still key
* Bonds weaker, market players await Polish bonds supply
* Czech c/a data showed a deficit, crown unaffected
(Adds fixed income, detail)
WARSAW, May 17 (Reuters) - Hungary's forint fell, while
other emerging currencies were little changed, as renewed
worries over the EU's rescue package put pressure on the euro -
the region's main reference currency - and weighed on the
central European units.
"The euro is getting smashed... and so are we," said one
Warsaw-based dealer. "It looks like the market is starting to
think that Europe is getting less capable of handling its own
problems."
German Chancellor Angela Merkel said on Sunday that a $1
trillion EU rescue plan had only bought the euro zone time to
tackle its fundamental problem - a widening gap between its
strongest and weakest economies. []
The euro fell more than 7 percent to the dollar this month,
dragging the CEE region's currencies lower. But they lost far
less than the common currency as analysts still see value there
due to the region's lower debt levels and higher growth
potential.
By 0923 GMT the forint <EURHUF=> was down 0.4 percent, while
the zloty <EURPLN=> rose 0.2 percent against the euro, off its
previous losses.
The Czech crown <EURCZK=> was unchanged against the euro,
trimming its previous gains after the current account data had
shown a surprise deficit due to foreign-owned companies'
dividend payments. []
"The (current account) figures are good from the trade
balance point-of-view, but overall the figures are negative for
the currency," said analyst Miroslav Frayer from Komercni Banka.
Current account data are also to be published in Poland, at
1200 GMT, but the figure is likely to have limited impact on the
zloty.
Dealers said trade in the coming days is likely to be
volatile, with moves on the EUR/USD setting trends.
"As far as I can see now, the EUR/USD will determine which
way we go today," a Budapest-based currency dealer said.
Romania's leu <EURRON=> was flat against the euro as
concerns over putative central bank interventions weighed.
Dealers said they suspected the bank had been intervening
both ways to keep the leu in the 4.1-4.2 range against the
common currency.
The central bank has consistently declined to comment on the
issue, but it has repeatedly signalled it did not like the leu's
volatility.
The bond market was also weaker across the region, tracking
currencies, with market players awaiting the release of Polish
bonds supply details for a tender due on Wednesday. The supply
information is due at 1000 GMT.
"Although situation in the euro zone cannot be put out of
sight, I think that bonds (in Poland) are weakening ahead of the
bonds supply," said one Warsaw-based dealer.
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2010
Czech crown <EURCZK=> 25.498 25.501 +0.01% +3.22%
Polish zloty <EURPLN=> 4.009 4.015 +0.15% +2.37%
Hungarian forint <EURHUF=> 277.35 276.19 -0.42% -2.52%
Croatian kuna <EURHRK=> 7.253 7.253 0% +0.77%
Romanian leu <EURRON=> 4.185 4.185 0% +1.25%
Serbian dinar <EURRSD=> 100.93 100.05 -0.87% -5%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond CZ2YT=RR -6 basis points to 106bps over bmk*
7-yr T-bond CZ7YT=RR +2 basis points to +105bps over bmk*
10-yr T-bond CZ9YT=RR -1 basis points to +94bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -3 basis points to +393bps over bmk*
5-yr T-bond PL5YT=RR -4 basis points to +348bps over bmk*
10-yr T-bond PL10YT=RR 0 basis points to +277bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR +15 basis points to +559bps over bmk*
5-yr T-bond HU5YT=RR +9 basis points to +510bps over bmk*
10-yr T-bond HU10YT=RR +13 basis points to +427bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1123 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 Stephen Nisbet)
