* Forint retreats from 5-week high, leu hits 6-month low * Romania has no new government * Dollar strength weighs on CEE FX By Sandor Peto and Luiza Ilie BUDAPEST/BUCHAREST, Dec 28 (Reuters) - Central European currencies eased against the euro on Wednesday, tracking a strengthening of the dollar, while investors watched Romania where President Klaus Iohannis rejected the Social Democrats' prime minister nominee after the Dec. 11 election. Figures published on Tuesday showed Romania's budget deficit remained well below the targetted 2.8 percent of economic output, at 0.73 percent of GDP. With no government formed, the country does not yet have a 2017 budget or debt issuance plans. The Social Democrat Party promised higher wages and pensions during the election campaign, which if implemented could see the deficit surge next year and keep inflation anaemic. The leu hit a new 6-month low against the euro. It traded at 4.5396 at 0911 GMT. The prospects of low inflation in the near term keep short-dated Romanian debt yields below better-rated Poland's levels, but Romania has the steepest yield curve in the region. Its 10-year bond yield was bid at 3.68 percent, up 2 basis points, while Poland's corresponding yield dropped 2 basis points to 3.42 percent. Hungarian government bonds were motionless, with no trading ahead of a news conference of the debt management agency AKK, scheduled for 1000 GMT, about issuance plans next year. Hungary's yields are lower than levels in Poland and Romania but are high relative to euro zone peers. The country's 10-year yield was fixed at 3.19 percent on Tuesday. The forint eased by 0.3 percent to 309.5 against the euro but stayed at the firmer side of the 310 mark, and may soon head again towards the 5-week highs touched on Tuesday at 308, Erste's Hungarian bank unit said in a note. Economy Minister Mihaly Varga said last week that recent forint levels between 310-315 were slightly weaker than anticipated, but would allow the government to meet its goal to lower the state debt ratio to economic output from end-2015. CEE SNAPS AT 1011 MARKETS HOT CET CURRENCIES Lates Previ Daily Chang t ous e bid close chang in e 2016 Czech crown 27.02 27.02 -0.01 -0.10 60 20 % % Hungary 309.0 308.1 -0.29 1.81% forint 500 400 % Polish 4.405 4.406 +0.0 -3.34 zloty 0 2 3% % Romanian 4.539 4.534 -0.10 -0.45 leu 5 8 % % Croatian 7.545 7.548 +0.0 1.25% kuna 0 5 5% Serbian 123.0 123.1 +0.1 -1.24 dinar 000 900 5% % Note: daily calculate previ close 1800 change d from ous at CET STOCK S Lates Previ Daily Chang t ous e close chang in e 2016 Prague 920.3 920.3 +0.0 -3.77 2 5 0% % Budapest 31922 31868 +0.1 +33. .27 .51 7% 45% Warsaw 1941. 1936. +0.2 +4.4 23 72 3% 1% Bucharest 7013. 7020. -0.11 +0.1 19 60 % 3% Ljubljana 703.2 703.6 -0.07 +1.0 2 9 % 2% Zagreb 1995. 1998. -0.13 +18. 52 11 % 10% Belgrade <.BELEX15 714.7 716.9 -0.30 +10. > 4 0 % 97% Sofia 582.8 583.3 -0.08 +26. 6 1 % 46% BONDS Yield Yield Sprea Daily d (bid) chang vs chang e Bund e in Czech sprea Republic d 2-year <CZ2YT=RR -1.07 -0.00 -025b -1bps > 1 9 ps 5-year <CZ5YT=RR -0.23 -0.00 +033 +0bp > 4 8 bps s 10-year <CZ10YT=R 0.468 -0.00 +028 +1bp R> 7 bps s Poland 2-year <PL2YT=RR 1.954 0 +278 +0bp > bps s 5-year <PL5YT=RR 2.724 -0.00 +329 +1bp > 1 bps s 10-year <PL10YT=R 3.46 0 +327 +2bp R> bps s FORWARD RATE AGREEMENT 3x6 6x9 9x12 3M inter bank Czech Rep < 0.2 0.24 0.12 0 PRIBOR=> Hungary < 0.37 0.4 0.48 0.38 BUBOR=> Poland < 1.75 1.77 1.795 1.73 WIBOR=> Note: FRA are for quotes ask prices ************************************************** ************ (Reporting by Sandor Peto; Editing by Janet Lawrence)