CEE MARKETS-Zloty underperforms as FX loan decision looms, Polish cenbank meeting in focus

By Anita Komuves BUDAPEST, May 5 (Reuters) - The Polish zloty eased on Wednesday, underperforming its peers as investors were concerned about an impending decision on forex mortgage loans while markets also eyed a rate meeting of the National Bank of Poland later in the day. While most central European currencies edged up, the zloty slid 0.32% to 4.5745 per euro. A supreme court decision on the conversion of Swiss franc mortgages due on May 11 was weighing on the zloty, a trader in Warsaw said. The issue could result in major losses for the banking sector, coming after thousands of Polish borrowers took out Swiss franc loans more than a decade ago. Investors were also eyeing the central bank's rate decision later in the day where no change is expected. However, an inflation spike last month has raised interest in the meeting. ​ A flash estimate released last week showed that Polish CPI jumped to 4.3% in April, up from 3.2% in March and well above the central bank's target range of 2.5% plus or minus one percentage point. The Polish central bank has already signalled it could look past a temporary spike in inflation and keep policy loose to help the economy recover from the coronavirus pandemic. Elsewhere, the Czech crown was little moved as markets awaited a rate decision due on Thursday, with eyes on more hints that the central bank could become the first in Europe to begin hiking rates later this year. Markets are pricing in chances of a hike possibly already in September. The bank has said it would move cautiously with rates given pandemic uncertainties, saying it saw a bigger risk in moving prematurely than waiting. The Hungarian forint was stuck in the 359.30-360.80 per euro range without a clear direction in low liquidity, a trader in Budapest said. Stock markets in the region firmed, with Warsaw leading gains by firming 1.34%. Budapest was up 0.85% while Prague firmed 0.37%. Bucharest gained more than 0.5%. CEE SNAPSHO AT MARKETS T 1044 CET CURRENC IES Latest Previous Daily Change bid close change in 2021 EURCZK= Czech % EURHUF= Hungary 0 % EURPLN= Polish EURRON= Romanian % EURHRK= Croatian % EURRSD= Serbian 0 % Note: calculated from 1800 daily CET change Latest Previous Daily Change close change in 2021 .PX Prague 1102.82 1098.740 +0.37 +7.37% 0 % .BUX Budapest 44410.9 44036.18 +0.85 +5.47% 1 % .WIG20 Warsaw 2030.99 2004.04 +1.34 +2.37% % .BETI Buchares 11525.8 11462.30 +0.55 +17.54 t 3 % % .SBITOP Ljubljan <.SBITOP 1065.82 1071.03 -0.49% +18.31 a > % .CRBEX Zagreb 1914.87 1916.76 -0.10% +10.09 % .BELEX1 Belgrade <.BELEX1 758.28 757.31 +0.13 +1.29% 5 5> % .SOFIX Sofia 522.23 522.39 -0.03% +16.69 % Yield Yield Spread Daily (bid) change vs change Bund in Czech spread Republic CZ2YT=R 2-year ps CZ5YT=R 5-year ps CZ10YT= ps Poland PL2YT=R 2-year ps PL5YT=R 5-year ps PL10YT= ps FORWARD 3x6 6x9 9x12 3M interba nk Czech 0.45 0.68 0.98 0.36 Rep Hungary 0.96 1.13 1.30 0.79 Poland 0.26 0.30 0.40 0.21 Note: are for ask FRA prices quotes ********************************************* ***************** (Additional reporting by Jason Hovet in Prague and Alan Charlish in Warsaw; Editing by Subhranshu Sahu)