PRAGUE, Oct 1 (Reuters) - The Czech crown hit an

eight-week low against the euro on Tuesday as rising risk

aversion and data showing continued decline in the region's

manufacturing sector kept central Europe's currencies on the

back foot.

The crown slipped as low as 25.280 to the euro in morning

trade before steadying to 25.269 by 0926 GMT, 0.2%

weaker on the day.

The region's currencies have been on a downward slope,

mainly led by the crown and Hungarian forint after their

respective central banks extended long-running interest

rate-cutting cycles last week.

Focus will turn to the Polish and Romanian central banks

this week, which are expected to stay on hold but markets will

look for new clues on the rate outlook.

In the meantime, global markets have guided the region in

recent sessions. The U.S. dollar rallied broadly on Tuesday

after Federal Reserve Chair Jerome Powell pushed back against

bets on more supersized interest rate cuts.

"The dollar's gains did not help," bank CSOB analysts said.

"Global yields and the eurodollar before Friday's U.S. payrolls

data will be a further dynamic (for currencies)."

A continued manufacturing downturn that is weighing on

central Europe's economy is another drag on the region's

currencies.

Purchasing Managers' Indices published on Tuesday showed

activity in central Europe stayed in contraction territory last

month, with weak demand mainly from key trading partner Germany

the biggest reason.

Poland's zloty fell 0.1% to 4.28 to the euro while

Romania's leu and Hungary's forint were both

steady, with the latter trading at 397.25 to the euro.

The forint, the region's worst performer this year with a

3.5% drop, is trading less than 1% away from the psychological

400 per euro level. The forint last weakened past that level in

March 2023.

A trader in Budapest said risk aversion was higher after

Israel's ground incursion into south Lebanon.

"There was some expectation that the forint could strengthen

after the end-of-the-month weakening but this war is making that

impossible due to risk aversion," the trader said.

CEE SNAPSHOT AT

MARKETS 1126

CET

CURRENCIES

Latest Previo Daily Change

us

trade close change in 2024

Czech 0

Hungary 00

Polish Romania Serbian 00

Note: calculated from 1800 CET

daily

change

Latest Previo Daily Change

us

close change in 2024

Prague 1609.41 1611.2 -0.11% +13.82

100 %

Budapes 74197.02 73896. +0.41% +22.40

t 18 %

Warsaw 3

Buchare 17616.02 17616. -0.01% +14.60

st 92 %

Spread Daily

vs Bund change

in

Czech spread

Republi

c

0

0

Poland

0

FORWARD RATE

AGREEMENTS

3x6 6x9 9x12 3M

interba

nk

Czech Hungary Poland Note: are for ask prices

FRA

quotes

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(Reporting by Jason Hovet in Prague, Anita Komuves in Budapest,

and Pawel Florkiewicz in Warsaw)