* Poland's economy grows 3.1 pct y/y in Q4
* Currencies hold gains as CEE outlook improves
* Romania to go ahead with eurobond in Q1
(Updates with Polish GDP figure)
By Marius Zaharia
BUCHAREST, March 2 (Reuters) - The zloty traded near
14-month highs on Tuesday as data showed the Polish economy grew
slightly faster than expectations in the fourth quarter of last
year and central European currencies held onto recent gains.
Poland's economy grew by 3.1 percent on the year in
October-December and by 1.7 percent in the whole of 2009, being
the only economy in central Europe to expand last year, when the
region was hammered by recession.
Analysts expect Poland to outperform the region this year as
well, a bet that is expected to further strengthen the zloty.
At 0914 GMT, the zloty <EURPLN=> was 0.1 percent down from
Monday's close at 3.931 per euro, near a 14-month high of 3.9205
hit during the previous session. The unit was little changed
immediately after the GDP release.
The Hungarian forint <EURHUF=> and the Czech crown <EURCZK=>
were flat.
"Currencies seem to be at levels that can be expected at
this point," a Prague dealer said. "But volumes are lower...
There is now only a small reshuffling with some investors."
Currencies rallied on Monday as data indicated better output
for the region in the coming months [], but
tensions in Greece were keeping markets volatile and investors
cautious about increasing exposure to emerging market assets.
Greece's problems have underlined central European states'
relatively healthy debt position compared with some peripheral
euro zone countries, though they have also dented risk appetite
and increased volatility.
ROMANIA'S EUROBOND
On Monday, Romania said it upped its domestic debt issuance
plans for March to 4 billion lei from the 2.8 billion lei it
sold last month, raising doubts in the market that the finance
ministry will go ahead with an announced Eurobond issue.
However, Deputy Finance Minister Bogdan Dragoi told Reuters
later in the day the Eurobond issue will take place in the first
quarter as planned [].
The Romanian leu <EURRON=> traded 0.2 percent weaker at
4.109 per euro, fighting a key technical level at 4.1.
"The 4.1 per euro level is a tough rock and it is blocking
further gains," one dealer said. "There is a fear in the market
that beyond this level the central bank will intervene as it
does not favour a stronger leu."
Moody's assigned a negative outlook to Romanian banks on
Monday, sending a warning signal to investors that unemployment
and bad debt could trouble the region this year.
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2010
Czech crown <EURCZK=> 25.824 25.829 +0.02% +1.91%
Polish zloty <EURPLN=> 3.931 3.928 -0.08% +4.4%
Hungarian forint <EURHUF=> 267.8 267.7 -0.04% +0.95%
Croatian kuna <EURHRK=> 7.26 7.255 -0.07% +0.68%
Romanian leu <EURRON=> 4.109 4.099 -0.24% +3.12%
Serbian dinar <EURRSD=> 99.29 99.22 -0.07% -3.43%
All data taken from Reuters at 1114 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
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(Reporting by Reuters bureaus, writing by Marius Zaharia;
editing by Stephen Nisbet)
