CEE MARKETS-Forint, crown give back gains as US-Iran tensions grow

    PRAGUE, Jan 6 (Reuters) - Hungary's forint retreated to a
key level against the euro on Monday as central Europe's
currencies gave up some recent gains amid growing U.S.-Iranian
tensions that hit sentiment in the region.
    The Czech crown also fell and backed off 20-month peaks hit
last week, bidding at 25.386 to the euro, down 0.2%. 
    The forint, after touching a nearly two-week high in new
year trade, fluctuated around 330 per euro as traders expected a
test of the resistance level. It was off 0.2% at 330.05 at 0923
    "Investors are nervous, and the positive story is less
visible for the forint right now," a Budapest-based dealer said.
    Investors grew cautious about riskier assets, worried that
the killing of Iran's most prominent military commander by the
United States could trigger a broader Middle East conflict.
    The new worries - after the region's currencies were hit for
much of 2019 by global trade concerns and uncertainty over
Britain's European Union divorce - were hitting sentiment in the
region following a rise in assets in recent months.
    Stock markets dropped, with Budapest falling 1.7% and
Prague down 0.8%
    Poland's zloty was flat while local markets were
closed for a holiday. Romania's leu was also steady.
    Romanian investors were geared up for the country's first
bond auction of 2020, with the finance ministry offering debt
due in 2023.
    "It will be interesting to see whether the new levels are
still interesting for investors, as the yields have shifted
almost 30 basis points lower from last month’s similar auction,"
ING analysts said in a note. 
    "We are a touch cautious on the result and expect an average
yield around secondary market bids of 3.90%."
    Czech bond yields were mixed and forward rate markets
discounted any chances of interest rate cuts ahead. The Czech
central bank, the most hawkish in the region, has voted against
a hike at the past three meetings. 
    Minutes from the bank's Dec. 18 meeting, published on
Friday, showed rate cuts remain off the table, analysts said.
                   CEE      SNAPSHO   AT                      
                   MARKETS  T        1023              
                            Latest   Previou  Daily    Change
                            bid      close    change   in 2020
 EURCZK  Czech     <EURCZK  25.3860  25.3460   -0.16%   +0.18%
 =       crown     =>                                  
 EURHUF  Hungary   <EURHUF  330.050  329.480   -0.17%   +0.33%
 =       forint    =>             0        0           
 EURPLN  Polish    <EURPLN   4.2425   4.2422   -0.01%   +0.33%
 =       zloty     =>                                  
 EURRON  Romanian  <EURRON   4.7750   4.7766   +0.03%   +0.28%
 =       leu       =>                                  
 EURHRK  Croatian  <EURHRK   7.4517   7.4453   -0.09%   -0.08%
 =       kuna      =>                                  
 EURRSD  Serbian   <EURRSD  117.400  117.570   +0.14%   +0.14%
 =       dinar     =>             0        0           
         Note:     calculated from            1800            
         daily                                CET      
         change Latest   Previou  Daily    Change
                                     close    change   in 2020
 .PX     Prague             1111.72  1121.44   -0.87%   -0.35%
 .BUX    Budapest           45353.5  46141.2   -1.71%   -1.58%
                                  1        2           
 .WIG20  Warsaw    <.WIG20  2173.97  2173.97   +0.00%   +1.11%
 .BETI   Buchares           9911.45  9921.59   -0.10%   -0.66%
 .SBITO  Ljubljan  <.SBITO   927.59   930.97   -0.36%   +0.19%
 P       a         P>                                  
 .CRBEX  Zagreb    <.CRBEX  2036.69  2036.69   +0.00%   +0.95%
 .BELEX  Belgrade  <.BELEX   801.69   801.69   +0.00%   +0.00%
 15                15>                                 
 .SOFIX  Sofia     <.SOFIX   569.86   568.60   +0.22%   +0.30%
                            Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
         Czech                                         spread
 CZ2YT=    2-year  <CZ2YT=   1.7740   0.0660   +241bp    +8bps
 RR                RR>                              s  
 CZ5YT=    5-year  <CZ5YT=   1.4290  -0.0580   +200bp    -5bps
 RR                RR>                              s  
 CZ10YT            <CZ10YT   1.6070  -0.0130   +191bp    +1bps
 =RR     10-year   =RR>                             s  
 PL2YT=    2-year  <PL2YT=   1.4890   0.0080   +212bp    +2bps
 RR                RR>                              s  
 PL5YT=    5-year  <PL5YT=   1.7890  -0.0180   +236bp    -1bps
 RR                RR>                              s  
 PL10YT            <PL10YT   2.0690  -0.0050   +237bp    +1bps
 =RR     10-year   =RR>                             s  
                   FORWARD  RATE     AGREEME                  
                            3x6      6x9      9x12     3M
         Czech     <CZKFRA     2.25     2.25     2.19     2.17
         Rep       ><PRIBO                             
         Hungary   <HUFFRA     0.24     0.30     0.42     0.16
         Poland    <PLNFRA     1.71     1.69     1.68     1.71
         Note:     are for ask                                
         FRA       prices                              

 (Reporting by Jason Hovet in Prague, Marton Dunai in Budapest
and Radu Marinas in Bucharest, Editing by William Maclean)