* Zloty seen firmer at 4.68/euro in 6 mths, 4.38 in 12 mths
* Czech crown seen weaker at 27.8/euro in 6 mths, 27.1 in 12
* Forint seen firmer at 295 in 6 mths, 281.70 in 12 mths
* Leu seen weaker at 4.4 in 6 mths, at 4.3 in 12 mths
By Sandor Peto
BUDAPEST, March 5 (Reuters) - The European Union's main
emerging currencies should recover from steep losses only in
more than six months' time and they will continue to move
together despite differing fundamentals, a Reuters poll showed
on Thursday.
The Polish zloty, Czech crown, Hungarian forint and Romanian
leu have fallen by 16-31 percent since last year on fears of
recession and concern the region may suffer a funding vacuum due
to the economic crisis and the credit crunch.
Policymakers have struggled to arrest the slides and those
from better off states like the Czechs and Poles have urged
investors not to lump them in with Hungary and Latvia, which
have taken IMF bailouts.
This week some of those statements appeared to gain some
traction, with dealers saying that partially due to economic
fundamentals they had taken long zloty and crown positions in
cross deals against the forint.
But the monthly poll of 45 analysts and strategists showed
investors are still expected to trade the region as a whole and
that the units would move largely together in the coming months.
"It makes a lot of sense that, given the weight of the euro
area downturn and its impact on exports, Central European
currencies should continue to weaken," said Koon Chow,
strategist at Barclays Capital.
"However one can still argue for a 'soft' form of
differentiation where some currencies fall by a greater
percentage than others."
Despite outperforming, the crown and leu, which have lost
only 3 and 6 percent this year, are seen falling further in the
short term than the zloty or the forint, down 12 and 15 percent
already in 2009.
The median forecasts saw the crown easing 3 percent to 28.50
per euro in a month from around 27.65 on Thursday, before
recovering to 27.82 by August and to 27.1 in 12 months.
The leu was seen easing 4.9 percent to 4.5 per euro by the
end of May and recovering to current levels only by February
next year.
The zloty is expected to stay roughly unchanged from
Thursday's levels at 4.72 in a month, firming to 4.38 in one
year.
The forint was seen at 305 per euro at end-March, firmer
than Wednesday levels of 311.75, and in 12 months it was seen
10.7 percent stronger at 281.70.
RISKS
Banking supervisors in the region on Wednesday complained
negative press over their financial sectors had hit markets and
said the countries should not be treated as a homogeneous whole.
Some signs have surfaced the market could be treating the
currencies differently, with the crown up 6.5 percent and the
zloty 4.2 higher since Feb. 17. But dealers said other factors,
such as large possible inflows into the crown because of a major
takeover deal, may have also been behind the move.
The analysts and strategists said the deepening global
crisis would continue to put the entire region under pressure.
The main risks were worsening economic growth -- many
economists feel no country will avoid recession this year --
defaults on foreign currency loans due to domestic currency
weakness, and downgrades by rating agencies, they said.
The forecasts in the poll for slow currency recovery late
this year reflect expectations that the global economy will
start to consolidate, analysts said.
The currencies can receive support if central European and
European Union decision makers take continued efforts to defend
the region's financial systems, analysts said. Although they
said efforts in the last two weeks to prop them up had appeared
to lack close coordination and had not boosted confidence.
"If the region's countries continue what they did in the
past days, that will send a bad message, that they are unable to
act together -- and everybody will suffer then," said Zsolt
Kondrat, MKB Bank analyst in Budapest.
(Reporting by Sandor Peto/Michael Winfrey/Jason Hovet)
