WARSAW, June 26 (Reuters) - Central Europe's currencies

slipped on Wednesday, led lower by the Czech crown a day ahead

of the Czech central bank decision on interest rates, as a

firming dollar and risk-off sentiment weigh on them.

A higher U.S. interest rate environment, with more hawkish

comments from the Federal Reserve officials on Tuesday, supports

the dollar, pressuring emerging market assets.

"EUR/USD has reverted back to 1.070 after some signs of

relief for CEE. Moreover, sentiment also dropped and turned a

bit more risk-off again, making it complicated for the region,"

ING analysts wrote in a note, adding they saw few local

positives in the coming days.

The Czech crown traded 0.3% lower against the euro at

24.8880, hovering off the previous week's lows, to which it

pulled back from a five month high hit in early June.

Investors are looking towards Thursday's rate decision at

which it could be a close call between whether the bank

maintains or slows its rate-cutting pace.

"Clearly 25bp or 50bp (cut) is on the table. The main

variable here seems to be EUR/CZK given that the rest of the

picture has been a given for some time," ING analysts wrote.

"The dynamics of CZK depreciation over the past week show

the market's sensitivity to the decision itself and reduce the

chances of a 50bp rate cut tomorrow in our view. On the other

hand, the strengthening CZK may in turn reassure the board and

clearly increases the chance of a 50bp move."

The Hungarian forint eased 0.1% to 396.15 per

euro, trading within its range of the past two weeks to which it

slipped from a nearly four-month high hit in late May.

"The strengthening of the dollar was not good for the

forint, it reversed the (forint's) strengthening seen on

Monday," MBH Bank wrote in a note.

The Polish zloty meanwhile was flat at 4.3015 per

euro.

"The zloty has seen several days of correcting losses

suffered after the European Parliament elections," Alior Bank

analysts wrote in a note.

"Yesterday, the first signals appeared that the dynamic

phase of correction is already behind us and with the dollar

rebounding, we can observe an attempt to stabilise EUR-PLN

around 4.30."

CEE SNAPSHOT AT

MARKETS 1146

CET

CURRENCIES

Latest Previou Daily Change

s

trade close change in 2024

Czech Hungary 0

Polish Romanian Serbian 0

Note: calculated from 1800 CET

daily

change

Latest Previou Daily Change

s

close change in 2024

Prague 1541.44 1540.60 +0.05% +9.01%

00

Budapest 70856.95 70647.0 +0.30% +16.89%

4

Warsaw Buchares 18319.56 18271.2 +0.26% +19.18%

t 7

Spread Daily

vs Bund change

in

Czech spread

Republic

2-year 5-year Poland

2-year 5-year FORWARD RATE

AGREEMENTS

3x6 6x9 9x12 3M

interban

k

Czech Hungary Poland Note: are for ask prices

FRA

quotes

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