(Updates throughout, changes dateline)
BUDAPEST, Aug 18 (Reuters) - Emerging European currencies,
battered by a resurgent dollar last week, extended morning gains
to close firmer versus the euro on Monday after the greenback
ticked broadly weaker in the session, traders said.
Hungary's forint <EURHUF=D2> led gains across central
European currencies to end the day 1.35 percent stronger at
236.04 against the euro in low turnover.
"We've firmed beyond all expectations, by about three
forints (versus the euro)," said a currency dealer in Budapest.
"The euro/dollar pair edged a bit weaker which is supportive
to the forint. After all, (gains in the dollar) was the main
reason behind the forint's retreat last week," the trader said.
"It may also be considered somewhat of a technical
correction after the unsuccessful attempt to break through 240
(per euro) last week," she said.
The other big winner of the day, the Czech crown
<EURCZK=D2>, firmed 1.18 percent versus the euro in thin
afternoon trade, erasing some of last week's losses.
"The whole region is firming," said a Prague currency
dealer. "Everybody is looking at the euro/dollar."
"The crown has just gone through all thinkable support
levels," another Prague trader said.
Poland's zloty <EURPLN=D2> also firmed, boosted by
expectations of an interest rate hike. It was also supported by
a rebound from a key technical level which economists said would
have capped a firming trend in the unit.
"Wage and employment growth data favour a hike. In addition,
the zloty neared 3.35 against the euro, a level that was to be
defended, because if exceeded it could signal a reversal of the
(appreciation) trend," said Mateusz Szczurek, chief economist at
ING Bank in Warsaw.
Croatia's kuna <EURHRK=>, which scaled record highs versus
the euro last week on the back of strong tourism inflows, ended
the day 0.14 percent stronger at 7.19.
Romania's leu <EURRON=> firmed 0.85 percent to end the
session at 3.52 per euro, but the Serbian dinar <EURRSD=> shed
0.29 percent.
Polish government bond yields dropped by up to 11 basis
points, mirroring similar moves in Czech debt prices, while in
Hungary yields ticked marginally lower in lacklustre trade.
"We are two or three basis points lower, but there hasn't
been any real activity in the session," said a fixed income
trader in Budapest.
*************************MARKET SNAPSHOT************************
Currency Latest Previous Local Local
close currency currency
change change
today in 2008
Czech crown <EURCZK=> 24.24 24.53 +1.18% +8.52%
Polish zloty <EURPLN=> 3.32 3.33 +0.3% +7.79%
Hungarian forint <EURHUF=> 236.04 239.28 +1.35% +6.65%
Croatian kuna <EURHRK=> 7.19 7.2 +0.14% +1.86%
Romanian leu <EURRON=> 3.52 3.55 +0.85% +1.68%
Serbian dinar <EURRSD=> 76.9 76.68 -0.29% +2.36%
Czech treasury bonds <0#CZBMK=>
3-yr T-bond CZ3YT=RR -6 basis points to -4bps over bmk*
5-yr T-bond CZ5YT=RR -6 basis points to 0bps over bmk*
10-yr T-bond CZ10YT=RR -10 basis points to +26bps over bmk*
Polish treasury bonds <0#PLBMK=>
2-yr T-bond PL2YT=RR -11 basis points to +233bps over bmk*
5-yr T-bond PL5YT=RR -7 basis points to +216bps over bmk*
10-yr T-bond PL10YT=RR -8 basis points to +197bps over bmk*
Hungarian treasury bonds <0#HUBMK=>
3-yr T-bond HU3YT=RR -1 basis point to +453bps over bmk*
5-yr T-bond HU5YT=RR -1 basis point to +425bps over bmk*
10-yr T-bond HU10YT=RR -3 basis points to +367bps over bmk*
*Benchmark is German bond equivalent.
All data taken from Reuters at 1705 CET.
Currency percent change calculated from the daily domestic
close at 1500 GMT.
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(Reporting by Reuters bureaus, writing by Gergely Szakacs;
Editing by Gerrard Raven)
