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CEE MARKETS-Currencies steady after Fed, region's central banks keep stable rates outlook

By Krisztina Than and Jason Hovet

By Krisztina Than and Jason Hovet BUDAPEST/PRAGUE, Oct 31 (Reuters) - Central European currencies were broadly steady versus the euro on Thursday after the U.S. Federal Reserve rate cut and comments which dented the dollar and boosted risk sentiment globally. Against the backdrop of monetary policy loosening by the world's largest central banks, central European rate-setters have generally adopted a wait-and-see mode, keeping rates on hold as the region has produced strong economic growth despite a slowdown in the eurozone, its main trading partner. They look likely to maintain this stance even though some Czech policy makers have spoken in favour of rate hikes. A blast of Czech central banker comments came on Wednesday ahead of the central bank's policy meeting next week, with most backing a view that rate stability will be maintained even as debate continues on a possible increase. Governor Jiri Rusnok said the domestic economy was far from recession and balancing contradictory foreign and domestic factors implied rate stability. Ceska Sporitelna economist Jiri Polansky said: "We expect next year inflation will stay above 2% and the bank will discuss the possibility of a hike even in 2020. But given the situation in the world economy and weak German data, they will wait and see how the situation evolves." The state of Brexit and U.S.-China trade talks will be key, Polansky added. Vice-Governor Marek Mora, one of two voting in the minority in September for a hike, was quoted by Lidove Noviny as saying he would probably vote for stability this time. STABLE RATES Central banker Oldrich Dedek told Reuters in an interview this week nothing had changed for him since the last meeting when he backed stable rates, adding debate on a cut was still far away. In Hungary, the central bank has maintained its accommodative stance and has repeatedly said downward inflation risks have increased. Poland's flash CPI stood at 2.5% in October, the statistics office said earlier on Thursday, in line with expectations. "The data will not have an impact on the Monetary Policy Council (MCP) decision on interest rates next week. MPC has consequently announced a long-term stabilization in the cost of money," said Monika Kurtek, chief economist at Bank Pocztowy, said in a note. At 0847 GMT, the crown was flat versus the euro, while the Hungarian forint was 0.1% weaker, along with the Polish zloty. "The Fed rate cut is good for emerging market currencies but for the time being we do not expect a significant forint strengthening," brokerage Equilor said. Stock markets fell across the region, in a correction after significant gains in recent days. CEE SNAPSH AT MARKETS OT 1047 CET CURREN CIES Latest Previo Daily Change us bid close change in 2019 EURCZK= Czech <EURCZK 25.498 25.505 +0.03% +0.82% crown => 0 5 EURHUF= Hungar <EURHUF 329.90 329.55 -0.11% -2.67% y => 00 00 forint EURPLN= Polish <EURPLN 4.2620 4.2597 -0.06% +0.65% zloty => EURRON= Romani <EURRON 4.7570 4.7585 +0.03% -2.17% an leu => EURHRK= Croati <EURHRK 7.4550 7.4622 +0.10% -0.60% an => kuna EURRSD= Serbia <EURRSD 117.37 117.49 +0.10% +0.79% n => 00 00 dinar Note: calculated from 1800 daily CET change Latest Previo Daily Change us close change in 2019 .PX Prague 1056.4 1061.8 -0.51% +7.08% 3 800 .BUX Budape 42231. 42796. -1.32% +7.90% st 83 70 .WIG20 Warsaw <.WIG20 2204.5 2227.3 -1.03% -3.17% > 0 8 .BETI Buchar 9630.7 9646.8 -0.17% +30.43% est 7 7 .SBITOP Ljublj <.SBITO 853.56 853.56 +0.00% +6.13% ana P> .CRBEX Zagreb <.CRBEX 1997.2 2002.2 -0.25% +14.21% > 3 6 .BELEX1 Belgra <.BELEX 748.68 749.79 -0.15% -1.71% 5 de 15> .SOFIX Sofia <.SOFIX 556.04 555.86 +0.03% -6.46% > BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republ ic CZ2YT=R <CZ2YT= 1.2850 0.0460 +194bp +7bps R 2-year RR> s CZ5YT=R <CZ5YT= 1.0750 -0.060 +172bp -2bps R 5-year RR> 0 s CZ10YT= <CZ10YT 1.4080 -0.003 +182bp +5bps RR 10-yea =RR> 0 s r Poland PL2YT=R <PL2YT= 1.4400 -0.025 +210bp +0bps R 2-year RR> 0 s PL5YT=R <PL5YT= 1.7160 -0.047 +236bp -1bps R 5-year RR> 0 s PL10YT= <PL10YT 1.9890 -0.029 +240bp +2bps RR 10-yea =RR> 0 s r FORWARD RATE AGREEM ENT 3x6 6x9 9x12 3M interbank Czech <CZKFRA 2.25 2.24 2.12 2.18 Rep ><PRIBO R=> Hungar <HUFFRA 0.27 0.31 0.34 0.20 y ><BUBOR => Poland <PLNFRA 1.73 1.71 1.68 1.71 ><WIBOR => Note: are for ask FRA prices quotes (Reporting by Krisztina Than Additional reporting by Agnieszka Barteczko in Warsaw and Jason Hovet in Prague Editing by David Holmes)