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CEE MARKETS-Warsaw at 5-month highs leads stocks gains, currencies mixed

* Warsaw leads stocks rise on Fed chair comments * Coal producer JSW shares rise more than 10 pct * Currencies are mixed, dollar and euro prospects are uncertain * Romania increases government bond sale again (Adds Romania's government bond auction, extended JSW stocks gains) By Sandor Peto BUDAPEST, Aug 27 (Reuters) - Polish stocks hit their strongest levels since March on Monday, leading Central European shares higher as they tracked a global rally after Friday's comments from the Federal Reserve suggested no pick-up in the pace or strength of U.S. interest rate hikes.

Stocks rose globally after comments from Fed chair Jerome Powell confirmed that rate hikes would remain gradual and dependent on economic data.

Poland's bluechip stock index hit its highest level since March 13.

At 1313 GMT, it was higher by 2.4 percent from Friday, with the heavy-weight sub-index of banks rising 2 percent.

The aggregated profit of Polish banks rose 17 percent year-on-year in the first half of the year according to data released on Friday.

The shares of JSW, the European Union's biggest coal producer, soared 10 percent to double earlier gains after JSW said it wanted to pay out 25-30 percent of its 2017 net profit in dividends. The stock was initially boosted by a higher-than-expected quarterly net profit reported on Friday.

Budapest's stock index rose almost 1 percent, driven by a 1.75 percent gain by Hungary's largest lender, OTP Bank that crossed a psychological barrier of 10,000 forints ($35.47).

But Central European currencies were mixed in cautious trading, with the dollar treading water.

The dollar's rally in the past few months has caused waves of emerging market selling including the EU's eastern economies.

Market players' net long bets on the dollar rose slightly last week, reflecting expectations for a further firming.

But uncertainty over U.S. President Donald Trump's future cast a shadow on the currency, while Italy's political and economic risks may weigh on the euro, Central Europe's reference currency, one Budapest-based currency dealer said.

The Turkish lira's woes is an additional uncertainty factor, the trader said.

While the Czech crown and the zloty firmed a shade, the forint eased slightly.

The leu weakened by 0.2 percent, retreating after a rise in the past three weeks.

While Central European government bonds were mostly steady, Romania's 2-year benchmark bond yield was bid higher by 21 basis points at 3.9 percent and the bid for the 3-year bond edged up by 5 basis points to 4 percent yield.

Some investors were trying to push the yields higher from 2-month lows they reached last week. The mid-yield between bid and ask, however, was little changed.

The yields fell earlier this month due to expectations that Romania's inflation could retreat rapidly in the second half of 2018 from June's 5.4 percent, the region's highest level.

The government sold more than planned 2020-expiry bonds at its second auction in a row that drew strong demand after a strong tender last week.

CEE SNAPSHOT AT MARKETS 1513 CET CURRENCI ES Latest Previous Daily Change bid close change in 2018 Czech Hungary Polish Romanian Croatian Serbian Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2018 Prague 1080.17 1072.860 +0.68% +0.19% 0 Budapest 36532.98 36192.13 +0.94% -7.22% Warsaw 2367.53 2312.70 +2.37% -3.81% Bucharest 8284.83 8271.66 +0.16% +6.85% Ljubljana <.SBITOP 866.53 865.27 +0.15% +7.46% > Zagreb 1819.21 1820.55 -0.07% -1.28% Belgrade <.BELEX1 734.37 730.52 +0.53% -3.35% 5> Sofia 633.77 636.32 -0.40% -6.45% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year 5-year 10-year Poland 2-year 5-year 10-year FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech Rep 1.84 1.96 2.05 1.49 (PRIBOR= ) Hungary 0.43 0.64 0.84 0.18 Poland 1.75 1.79 1.83 1.71 Note: FRA are for ask prices quotes ************************************************* ************* (Reporting by Sandor Peto, editing by Andrei Khalip)