* Poland gears up for two-round presidential election
* Polish bonds fell after output data, c.banker comments
* Czech president names Singer as new cbank governor
(Updates with Polish output data)
By Marius Zaharia and Dagmara Leszkowicz
BUCHAREST/WARSAW, June 18 (Reuters) - The Polish zloty was
relatively stable ahead of presidential elections due on Sunday,
while the crown fell slightly after the Czech president named
the new central bank governor.
Meanwhile, Polish bond yields rose some 2-3 basis points
across the curve after central banker Adam Glapinski called for
a 50 basis points rate hike later in 2010 following a surge in
industrial output data in May. []
In Poland, opinion polls tip Bronislaw Komorowski, of the
governing Civic Platform party, to win the presidential contest
that starts on Sunday, but his challenger Jaroslaw Kaczynski --
the twin brother of the President who died in a plane crash
earlier this year -- has narrowed the gap.
The outcome will probably be decided in a July 4 run-off.
Markets would probably cheer a win by Komorowski, fearing
Kaczynski could imperil reforms by using the President's right
of veto, just as his brother did.
"We believe a Komorowski win is to a large extent priced
into the markets and if anything it will only have a marginal
positive immediate impact on the zloty," analysts at Nordea
wrote in a note.
Analysts said any market impact would probably materialise
after the second round, when any uncertainty regarding the
outcome disappears.
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For a take-a-look on Polish election, see []
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Polish statistics office data showed industrial output rose
in double-digit figure, showing the economic recovery was strong
and monetary tightening would be needed in the second half of
the year. []
At 1408 GMT, the zloty <EURPLN=> and Romania's leu <EURRON=>
were each flat, while the Hungarian forint <EURHUF=> rose 0.1
percent and the Czech crown <EURCZK=> fell some 0.2 percent
against the euro.
Warsaw's bourse <> was up 1.0 percent, leading gains
in the region.
NEW CZECH BANK GOVERNOR
Czech President Vaclav Klaus named Miroslav Singer on Friday
as the next central bank governor, replacing Zdenek Tuma
[]. Analysts had expected Singer or vice-governor
Mojmir Hampl to be named.
"It is an excellent choice," said Wood & Co's Raffaella
Tenconi. "He is extremely competent and ... he will also add to
the credibility of the independence of the central bank."
Singer's appointment is not seen influencing the outcome of
Wednesday's central bank meeting, when the bank is widely
expected to leave base rates unchanged at a record low 0.75
percent.
"The majority of the market is forecasting the next move up,
next year," a dealer said.
"It is still mainly playing the game of risk appetite."
Nine of 17 analysts surveyed see the next hike in the first
half of 2011, five forecast a rise in the second half of 2010.
[]
Elsewhere, Hungary is expected to keep its rates on hold on
Monday for the second month in a row after a series of cuts
dating back to July 2009. []
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2010
Czech crown <EURCZK=> 25,774 25,712 -0,24% +2,11%
Polish zloty <EURPLN=> 4,07 4,069 -0,02% +0,84%
Hungarian forint <EURHUF=> 279,96 280,11 +0,05% -3,43%
Croatian kuna <EURHRK=> 7,205 7,203 -0,03% +1,45%
Romanian leu <EURRON=> 4,236 4,235 -0,02% +0,03%
Serbian dinar <EURRSD=> 103,78 103,44 -0,33% -7,61%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond CZ2YT=RR -11 basis points to 150bps over bmk*
7-yr T-bond CZ7YT=RR -10 basis points to +163bps over bmk*
10-yr T-bond CZ9YT=RR -3 basis points to +153bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -2 basis points to +410bps over bmk*
5-yr T-bond PL5YT=RR -7 basis points to +370bps over bmk*
10-yr T-bond PL10YT=RR -5 basis points to +307bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR +5 basis points to +635bps over bmk*
5-yr T-bond HU5YT=RR -9 basis points to +570bps over bmk*
10-yr T-bond HU10YT=RR -6 basis points to +503bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1608 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 AND
Dagmara Leszkowicz Editing by Susan Fenton/Toby Chopra)
