* Leu edges up as Romania closer to IMF deal
* Hungary cbank continues talking up forint
* Key Polish cbanker says there may be no room for rate cuts
BUCHAREST, March 10 (Reuters) - The Romanian leu firmed
against the euro on Tuesday as the country appeared to move
closer to an IMF deal, and a renewed verbal defence kept
investors alert in Hungary and gave a boost to the forint.
Darkening economic outlooks and worries over some countries'
high external financing needs have put emerging Europe in focus,
with currencies getting hammered as investor flows exit the
region.
An International Monetary Fund mission is due to start a
two-week visit to Bucharest on Wednesday to discuss a potential
aid programme. On Monday, President Traian Basescu told
Parliament a foreign loan was the only solution to safeguard the
troubled economy [].
"This is positive for the leu, the market is happy with the
prospect of an IMF deal," one dealer in Bucharest said. "But
while the good news are in Romania, the leu firms less as it was
already strong compared to the zloty and the forint."
The Romanian leu <EURRON=> added 0.3 percent from Monday
domestic close levels, while signs of indirect central bank
intervention this year has kept it from double digit falls of
some peers.
In Poland, the zloty <EURPLN=> gained 0.5 percent and the
Czech crown <EURCZK=> rose 0.6 percent.
The Hungarian forint <EURHUF=> firmed 0.8 percent to 307.6
to the euro after central bank Governor Andras Simor said the
national bank is ready to act if measures fail to stop the
decline of the forint. []
The call followed its strongest statement yet on Sunday when
it said it would channel European Union funds into the market
and pump euro liquidity into the banking system to prop up the
unit, which hit an all-time low of 317.45 last week.
Dealers said the comments have provided some support.
"Markets are looking at key levels to see where the forint
bounces back and what could be a critical level for the bank,"
one dealer said. "This could keep speculators cautious."
In Poland, a key swing voter in the central bank said
Poland's economic conditions and a sharp weakening of the zloty
may not justify further interest rate cuts [].
The comments come after an attempt by the central bank on
Monday to defend the zloty by saying it was undervalued
[].
Policymakers across the region have repeatedly stated over
the past weeks that currencies were undervalued and urged for
differentiation between economies in the region, as some--like
Poland and Czech Republic--had better fundamentals.
Despite these comments, analysts have said currencies are
set for further weakening and some rebound would not likely come
until the second half of the year. []
----------------------MARKET SNAPSHOT-------------------------
Currency Latest Previous Local Local
close currency currency
change change
today in 2009
Czech crown <EURCZK=> 27.368 27.543 +0.64% -2.25%
Polish zloty <EURPLN=> 4.715 4.736 +0.45% -12.73%
Hungarian forint <EURHUF=> 307.64 309.95 +0.75% -14.33%
Croatian kuna <EURHRK=> 7.434 7.45 +0.22% -0.93%
Romanian leu <EURRON=> 4.287 4.3 +0.3% -6.36%
Serbian dinar <EURRSD=> 93.87 94.228 +0.38% -4.68%
All data taken from Reuters at 1023 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 Victoria Main)
