* Zloty, forint firm further on better global mood
* Leu in stand-by, waiting for political developments
By Marius Zaharia
BUCHAREST, Oct 6 (Reuters) - The Polish zloty led gains in
central Europe on Tuesday and Hungary's forint hovered near its
highest since late August as better sentiment in the region
added to recent gains.
In Romania, political uncertainty continued to weigh on the
leu, while market perception of a more doveish stance from the
Czech central bank held the crown back.
The forint continued a rally started on Friday after
Standard & Poor's raised Hungary's rating outlook, saying the
government will contain a deterioration in finances despite a
deep recession.
Regional assets were supported also by an overnight rally in
Asian shares after U.S. services sector data increased risk
appetite. []
The zloty, seen outperforming its peers in the longer run,
made the most of it, as fears a large dividend would flood the
market were erased by a government deal with Dutch firm Eureko
last week, opening the way for rises. []
At 0743 GMT, the zloty <EURPLN=> was 0.4 percent firmer from
the previous domestic close, while the forint <EURHUF=> was up
0.2 percent, near 266.5 to the euro, its highest since
end-August and unshaken by poor industry data [].
"Taking into account that sentiment on global bourses has
gotten better ... there are real chances for the zloty to
strengthen towards 4.15 to the euro," Bank BPH said in a note.
In Romania, the leu <EURRON=> edged up 0.1 percent, shyly
following peers, with the markets waiting for more political
developments after the ruling coalition split last week, leaving
behind a fragile minority government.
The opposition Liberal Party said it plans to file a
no-confidence vote against the minority government, and the
leftist Social Democrats, which left Prime Minister Emil Boc's
cabinet last week, said they would back it.
However, with Romania's long-standing tradition of fleeting
political alliances it was unclear whether the government would
fall, which is why markets were on stand-by.
"The leu missed the region's overnight rally, because while
the market hasn't build any expectation for a no-confidence vote
yet, it is clear the leu will weaken if the government
collapses," one Bucharest-based dealer said.
The Czech crown <EURCZK=> lagged the region to bid flat
around 25.485 per euro after central bank chief Zdenek Tuma said
on Monday policymakers would consider intervening to weaken the
crown or cut interest rates if the currency keeps firming,
although the bank is no fan of intervention. []
--------------------------MARKET SNAPSHOT--------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 25.485 25.501 +0.06% +4.98%
Polish zloty <EURPLN=> 4.194 4.212 +0.43% -1.88%
Hungarian forint <EURHUF=> 266.57 267.04 +0.18% -1.13%
Croatian kuna <EURHRK=> 7.253 7.257 +0.06% +1.54%
Romanian leu <EURRON=> 4.259 4.264 +0.12% -5.74%
Serbian dinar <EURRSD=> 92.99 93.06 +0.08% -3.77%
All data taken from Reuters at 0947 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 Chris Pizzey)
