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CEE MARKETS-Currencies, stocks rebound as markets take a breather ahead of Fed

       By Krisztina Than
       BUDAPEST, March 21 (Reuters) - Central European
currencies firmed and stocks rebounded on Tuesday as global
sentiment improved after the rescue of troubled lender Credit
Suisse by its Swiss rival UBS, with shares in Hungary's
OTP jumping 3.1% in early trade.
    Hungary's forint, which hit an 11-week low on
Monday past 400 to the euro, was trading at 392 to the euro,
rising 1.07% and outperforming its peers.
    "The forint's exchange rate reversed (its retreat) above the
200-day moving average ... with an improvement in international
sentiment coming at the best possible time," brokerage Equilor
said in a note. "Today's trading also looks exciting with
volatility remaining above average."
    The Hungarian central bank holds a tender for short-term
discount bills on Tuesday, where it is offering 1 trillion
forints worth of bills as part of its efforts to drain
forint liquidity from the market. It is also holding FX swap
tenders offering euro liquidity to banks.
    The bank has maintained an 18% quick deposit rate since last
October, when the forint hit record lows beyond 434 to the euro.
Its base rate of 13% is also the highest in the European Union,
with annual inflation running at 25.4% in February.
    Apart from watching news related to the bank sector in
Europe, investors are also looking forward to this week's
meeting of the U.S. Federal Reserve.
    Investors will be watching to see "whether the tensions in
the banking system would prevent further rate hikes," said
analysts at Magyar Bankholding in a note.
    The Polish zloty also firmed, by 0.2% to 4.6965 to
the euro, along with the Czech crown.
    Analysts at Commerzbank said the zloty could have more room
to firm this year as inflation is expected to decline.
    "The Polish inflation trend looks set to turn more benign
over the coming quarters as it has done in the Czech Republic
(Hungary remains an exception in the hawkish direction),"
Commerzbank said.
    "This in turn supports our view that the zloty could
appreciate by the end of this year, other disruptive market
factors permitting."
    Stock markets across the region gained on Tuesday, with
Warsaw's WIG 20 index rising 1.3% and Budapest up
1.6% by 0833 GMT.
    Prague's index, which on Monday hit a two-month low, was
also up 1.3%, benefiting from improved sentiment. Shares in
utility CEZ rose, but underperformed, after 2022
earnings indicated a record dividend. Profits this year are set
to fall.

                   CEE      SNAPSHO   AT
                   MARKETS  T        0933
                            Latest   Previou  Daily    Change
                            bid      close    change   in 2023
 EURCZK  Czech     EURHUF  Hungary   0        0
 EURPLN  Polish    EURRON  Romanian  EURHRK  Croatian  EURRSD  Serbian   0        0
         Note:     calculated from            1800
         daily                                CET

                            Latest   Previou  Daily    Change
                                     close    change   in 2023
 .PX     Prague             1341.90  1324.55   +1.31%   +11.66
                                          00                 %
 .BUX    Budapest           41988.5  41343.6   +1.56%   -4.12%
                                  1        2
 .WIG20  Warsaw    .BETI   Buchares           12142.8  12053.5   +0.74%   +4.11%
         t                        8        9
 .SBITO  Ljubljan  %
 .CRBEX  Zagreb    7%
 .BELEX  Belgrade  .SOFIX  Sofia     Yield    Yield    Spread   Daily
                            (bid)    change   vs Bund  change
         Czech                                         spread
 CZ2YT=    2-year  s
 CZ5YT=    5-year  s
 CZ10YT            s
 PL2YT=    2-year  s
 PL5YT=    5-year  s
 PL10YT            s
                            3x6      6x9      9x12     3M
         Czech     Hungary   Poland    Note:     are for ask
         FRA       prices

 (Reporting by Krisztina Than in Budapest, and Pawel Florkiewicz
in Warsaw; editing by Mark Potter)

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