CEE MARKETS 3-Zloty off highs, forint slips vs Swiss franc

                                
  * Zloty off 1-mth high but state-owned BGK's buying supports
  * Hungary pays higher yield on bonds, CHF/HUF near record high
  * Poland to issue 12-18 bln zlotys worth of T-bills in Q1
                                
 
 (Adds Hungary auction, Poland supply, updates markets)
                                
 By Dagmara Leszkowicz and Marton Dunai
                                
 WARSAW/BUDAPEST, Dec 30 (Reuters) - The Polish zloty held
near a one-month high on Thursday, helped by state-owned BGK
bank converting euros into the local currency, while the
Hungarian forint flirted with an all-time low against the Swiss
franc in thin year-end trade.
                                
 "BGK is likely to rule in the market until the end of the
year," said one Warsaw-based dealer. "The local support level is
(EUR/PLN) 3.96."
                                
  At 1339 GMT, the zloty was steady on the day near a
previous high of 3.957 to the euro in thin trade.
                                
 BGK can convert euros into zlotys on behalf of the finance
ministry, which needs to exchange European Union funds. The
bank's presence in the market also has a psychological impact in
supporting the zloty, dealers say.
                                
 Hungary's forint <EURHUF=>, meanwhile, gave up 0.2 percent
vs the euro from Wednesday as the country's assets continued to
feel the effects of two recent rating downgrades.
                                
 The forint also suffered against the global safe haven Swiss
franc, whose strength pushed the CHF/HUF pair near the all-time
high of 226.36 in intraday trading. The strength of the franc,
the main funding unit of Hungary's foreign currency loans, hurts
the hundreds of thousands of Hungarian households who have taken
out franc-denominated debt.
                                
 The Czech crown <EURCZK=> and Romania's leu <EURRON=> were
flat. The crown is the top gainer in the region this year,
having added 4.4 percent mainly on the back of the country's
solid economic fundamentals. The zloty has firmed some 3.5
percent since the start of the year.
                                
 Hungary's forint <EURHUF=> and Romania's leu <EURRON=> have
slipped 3.2 percent and 1.2 percent, respectively, in 2010 amid
political tension and uncertainty over their fiscal outlooks.
                                
 Data from the National Bank of Hungary showed the country's
current account surplus stood at 477 million euros in the third
quarter, more than analysts' forecasts. [ID:nLDE6BT06X]
                                
 Hungary was forced to pay yields up to a quarter of a
percent above recent levels as it sold 45 billion forints worth
of bonds at the year's last auction, as planned. [ID:nBUD005668]
                                
 Poland said it would sell 12-18 billion zlotys worth of
treasury bills at 12 auctions in the first quarter.
[ID:nWSF009845]
                                
 Both countries' bond markets were quiet at the end of the
year.
--------------------------MARKET SNAPSHOT--------------------
Currency                    Latest   Previous Local    Local
                                
                                  close    currency currency
                                
                                           change   change
                                
                                           today    in 2010 
Czech crown      <EURCZK=>  25.217   25.283  +0.26%   +4.37%
Polish zloty     <EURPLN=>   3.965    3.965   0%      +3.51%
Hungarian forint <EURHUF=>  279.31    278.9  -0.15%   -3.21%
Croatian kuna    <EURHRK=>   7.384    7.385  +0.01%   -1.01%
Romanian leu     <EURRON=>   4.286    4.286   0%      -1.13%
Serbian dinar    <EURRSD=> 105.113    104.9  -0.2%    -8.78%
Yield Spreads
Czech treasury bonds <0#CZBMK=>
2-yr T-bond   CZ2YT=RR   +3 basis points to  +83bps over bmk*
7-yr T-bond   CZ7YT=RR   -2 basis points to  +83bps over bmk*
10-yr T-bond  CZ9YT=RR   +7 basis points to  +79bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond   PL2YT=RR   +2 basis points to  +382bps over bmk*
5-yr T-bond   PL5YT=RR   +6 basis points to  +360bps over bmk*
10-yr T-bond PL10YT=RR   +3 basis points to  +301bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond   HU3YT=RR    +7 basis points to  +670bps over bmk*
5-yr T-bond   HU5YT=RR   +14 basis points to  +604bps over bmk*
10-yr T-bond  HU10YT=RR  +12 basis points to  +500bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1439 CET.
Currency percent change calculated from the daily domestic 
close at 1700 GMT.
                                
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 (Reporting by Reuters bureaus, Writing by Marton Dunai and
Dagmara Leszkowicz, Editing by Hugh Lawson)