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Poland rate decision awaited

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Chinese stocks rise about 1% on improving demand hopes

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Stocks down 0.2%, FX off 0.1%

By Shashwat Chauhan

May 9 (Reuters) - Most currencies in emerging Europe

held steady against the euro on Thursday, with Poland's zloty at

over three-week lows ahead of a central bank rate decision later

in the day, while Polish stocks outpaced regional peers on

upbeat results.

The zloty held steady at 4.29 per euro, its lowest

level since mid-April ahead of a decision by the central bank,

which is expected to leave rates unchanged at 5.75%.

"The NBP is tipped to leave rates at 5.75% for the seventh

consecutive meeting and guide for policy (to) stay as at present

until the end of the year," Societe Generale strategists said.

"A hawkish hold could tempt sellers of EUR/PLN to have a go

at the April lows near 4.25."

The Czech crown was flat at 24.9 per euro after

data showed March retail sales rose more than expected to 6.1%

against expectations of a 2.7% increase.

Hungary's forint was also flat at 388.4 per euro,

while South Africa's rand gained 0.2% after falling for

the last two sessions.

Currencies in emerging Europe have been under pressure

lately as most central banks in the region stepped up policy

easing amid signs of falling inflation.

As of 0816 GMT, MSCI's index for emerging market currencies

slipped 0.1%, while a gauge for stocks

lost 0.2%.

Poland's WIG 20 stock index advanced 0.7%, boosted

by a 1% rise in PKO BP after the country's biggest bank

beat market expectations for first-quarter net profit.

Russia's rouble-denominated stock index gained

0.1%, while shares in Johannesburg fell 1%.

Helping stave off steep losses on the broader MSCI index,

Chinese bourses closed nearly 1% higher after data showed the

country's exports and imports returned to growth in April after

contracting in the previous month, signalling an encouraging

improvement in demand at home and overseas.

Elsewhere in emerging markets, Malaysia's central bank kept

its benchmark interest rate unchanged at 3%, in line with market

expectations.

Later in the day, central bank action will take centre stage

once again with rate verdicts due in Mexico and Peru.

HIGHLIGHTS:

** Turkish central bank lifts 2024 inflation forecast to 38%

** EU envoys agree on law to use profits from frozen Russian

assets for Ukraine, sources say

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