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CEE MARKETS-Forint paces FX gains on robust GDP, cbank verbal intervention

By Anita Komuves

By Anita Komuves Feb 14 (Reuters) - The Hungarian forint paced regional gains on Friday morning, reacting to robust GDP growth and verbal intervention from the National Bank of Hungary against recent marked currency weakening. The forint was bid at 335.25 against the euro, 0.7% stronger on the day, after hitting a record low of 340.31 on Wednesday. "Both markets and analysts consider remarks by the central bank deputy governor as hawkish. But the words of the NBH will have to be followed by action," a dealer in Budapest said. Dealers said markets paid close attention to NBH deputy governor Marton Nagy's remarks, which were delivered to investors in London earlier on Friday. Reuters confirmed the investor call took place but not what Nagy told participants. The National Bank of Hungary (NBH) is the most dovish in the region and has kept its benchmark rate at a record low of 0.9% since 2016. Hungary's economic growth slowed to an annual 4.5% in the fourth quarter from 5.0% in the third quarter, matching analyst forecasts and hitting its slowest in almost two years, preliminary unadjusted data showed on Friday. Hungary's government expects economic growth at 3.5% this year, below its previous 4% forecast, Finance Minister Mihaly Varga said on Friday. He added that recent falls in the forint were broadly neutral for the government budget and reiterated his view that Hungary needed a stable and predictable exchange rate. "Despite the global and European slowdown the Hungarian economy is still growing, and that strengthens the forint," a dealer in Budapest said. The Czech crown gained a third of a percent to its strongest since October 2012 after inflation grew at its fastest pace in almost eight years. The Czech central bank surprised markets with a rate hike last week. The forint's gains also helped the crown's gains as well as other regional units, a dealer said. The Czech economy expanded by an annual 1.7% in the fourth quarter, below expectations for 1.9% in a Reuters poll, marking the slowest pace in six years. The Polish stock market and the zloty both traded flat after inflation rose faster than expected in January, reaching 4.4% year-on-year, a nine-year high, after a 3.4% reading in December. ** For an interactive graphic on GDP: https://tmsnrt.rs/2qMFUkq CEE SNAPSHO AT MARKETS T 1049 CET CURRENC IES Latest Previou Daily Change s bid close change in 2020 EURCZK= Czech <EURCZK= 24.7900 24.8805 +0.37% +2.59% crown > EURHUF= Hungary <EURHUF= 335.250 337.700 +0.73% -1.22% forint > 0 0 EURPLN= Polish <EURPLN= 4.2395 4.2466 +0.17% +0.40% zloty > EURRON= Romanian <EURRON= 4.7675 4.7651 -0.05% +0.44% leu > EURHRK= Croatian <EURHRK= 7.4490 7.4493 +0.00% -0.05% kuna > EURRSD= Serbian <EURRSD= 117.560 117.560 +0.00% +0.01% dinar > 0 0 Note: calculated from 1800 daily CET change Latest Previou Daily Change s close change in 2020 .PX Prague 1101.66 1104.10 -0.22% -1.25% 00 .BUX Budapest 44947.7 44629.5 +0.71% -2.46% 1 1 .WIG20 Warsaw 2121.38 2120.07 +0.06% -1.34% .BETI Buchares 10091.5 10095.9 -0.04% +1.15% t 8 9 .SBITOP Ljubljan <.SBITOP 980.91 977.64 +0.33% +5.95% a > .CRBEX Zagreb 2027.51 2029.20 -0.08% +0.50% .BELEX1 Belgrade <.BELEX1 815.18 816.52 -0.16% +1.68% 5 5> .SOFIX Sofia 562.91 563.46 -0.10% -0.92% Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic CZ2YT=R 2-year <CZ2YT=R 1.9690 0.1940 +262bp +20bps R R> s CZ5YT=R 5-year <CZ5YT=R 1.6220 -0.0130 +223bp +0bps R R> s CZ10YT= <CZ10YT= 1.5790 0.0630 +198bp +7bps RR 10-year RR> s Poland PL2YT=R 2-year <PL2YT=R 1.6050 -0.0190 +225bp -2bps R R> s PL5YT=R 5-year <PL5YT=R 1.8390 -0.0270 +245bp -2bps R R> s PL10YT= <PL10YT= 2.1870 -0.0380 +259bp -3bps RR 10-year RR> s FORWARD 3x6 6x9 9x12 3M interba nk Czech 2.37 2.31 2.27 2.39 Rep <PRIBOR= > Hungary 0.76 0.90 1.01 0.42 Poland 1.73 1.74 1.73 1.71 Note: are for ask FRA prices quotes ********************************************* ***************** (Additional reporting by Jason Hovet in Prague and Alan Charlish in Warsaw; Editing by Maju Samuel)