* PMI readings up; Poland dips, Hungary jumps
* Euro, stocks lend support to FX
PRAGUE, Aug 2 (Reuters) - A firmer euro and rising stocks
boosted central European currencies on Monday, with the Polish
zloty leading gains as it broke though a key resistance level.
Investors also looked to the latest manufacturing surveys to
assess the strength of recovery in a region highly dependent on
trade to the euro zone.
Poland's purchasing manufacturing index (PMI) inched down on
the month to fall short of expectations but held above the 50
mark dividing expansion from contraction. Hungarian PMI jumped
into growth territory at 53.5, giving a small boost to the
forint. [] []
The zloty <EURPLN=> rose 0.5 percent to bid at 3.985 to the
euro by 0708 GMT, breaking the 4.0 level at which it has failed
to hold on to gains in the past month.
Hungary's currency <EURHUF=> gained 0.3 percent. The Czech
crown <EURCZK=>, the region's best performer this year, bid up
0.1 percent ahead of July PMI due at 0730 GMT.
Central European currencies often track moves in the
euro/dollar, which was nearing a three-month high.
Stock markets in central Europe rose by up to 1.5 percent,
led by Budapest <>.
"International optimism is going strong still, with the
dollar and the yen weaker (against the euro), and the mood on
local markets is calming further," a Budapest dealer said.
"Although strengthening (in the forint) is the likelier way
forward, a correction is on the cards all the time."
Markets are also eyeing central bank rate decisions out of
Romania and the Czech Republic this week that are expected to
keep rates on hold.
Analysts expected some retreat in the crown leading up to
Thursday's meeting, after it firmed below the 25 per euro level
to a 20-month high last week. That level has sparked verbal
interventions from the central bank in the past.
The unit is 0.4 percent off its peak of last week.
In Romania, the leu <EURRON=> edged 0.3 percent up, but
dealers said any gains would likely be limited by the
possibility of central bank intervention on currency markets to
prevent volatility.
Trade may also remain subdued before the end of an
International Monetary Fund review of Romania and its aid
package due to end on Wednesday.
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2010
Czech crown <EURCZK=> 24.72 24.751 +0.13% +6.46%
Polish zloty <EURPLN=> 3.985 4.003 +0.45% +2.99%
Hungarian forint <EURHUF=> 282.45 283.42 +0.34% -4.28%
Croatian kuna <EURHRK=> 7.23 7.233 +0.04% +1.1%
Romanian leu <EURRON=> 4.237 4.248 +0.26% +0.01%
Serbian dinar <EURRSD=> 106.43 106.29 -0.13% -9.91%
All data taken from Reuters at 0908 CET.
Currency percent change calculated from the daily domestic
close at 1600 GMT.
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(Reporting by Reuters bureaus, writing by Jason Hovet;
Editing by John Stonestreet)
