Conflict between neighbouring Ukraine and Russia has slowed economic recovery in Central Europe, contributing to expectations the Polish central bank will resume rate cuts, which appeared to have ended last year.
The region's currencies, including the zloty
Analysts said the market would be watching industrial output data scheduled for 13:00 PM BST.
"The drop of the Poland manufacturing PMI index below 50 points in July supports our forecast for industrial output at -0.6 percent year-on-year," Raiffeisen said in a note. "A low result will be an important dovish signal for the Monetary Policy Council."
However, Tuesday's figures for Polish wages made the outlook for central bank policy less clear. They showed private-sector wages rose in July, but by an average 3.5 percent year-on-year rather than the 3.7 percent forecast by analysts.
"The data argue that the Polish economy is not weakening as much as the PMI may suggest," Germany's Commerzbank said in a note. "This makes a 25 basis points (as opposed to 50 basis points) rate cut on 3 Sept more likely now."
The Czech crown
The bank pledged late last year to keep the crown from strengthening past around 27 per euro while letting it float freely on the weak side of that level.
The bank's Governor, Miroslav Singer, said on Tuesday that the Czech economy could expand by a decent 2-3 percent even without the help of foreign factors, referring to the weak euro zone economy.
"His comments suggest that the central bank sees no immediate need to loosen monetary policy further," Commerzbank said in a note.
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**************** CEE MARKETS SNAPSHOT AT 1046 CET ************
************************* CURRENCIES *************************
Latest Previous Daily Change
bid close change in 2014
Czech crown
Hungary forint
Polish zloty
Romanian leu
Croatian kuna
Serbian dinar
Note: daily change calculated from previous close at 1800 CET
**************************** STOCKS **************************
Latest Previous Daily Change
close change in 2014
Prague <.PX> 978.07 982.70 -0.47% -0.90%
Budapest <.BUX> 17715.56 17670.58 +0.25% -3.37%
Warsaw <.WIG20> 2441.49 2447.99 -0.27% +1.54%
Bucharest <.BETI> 7050.92 7059.41 -0.12% +8.85%
Ljubljana <.SBITOP> 802.35 797.91 +0.56% +25.17%
Zagreb <.CRBEX> 1850.30 1845.54 +0.26% +3.93%
Belgrade <.BELEX15> 614.93 615.04 -0.02% +11.48%
Sofia <.SOFIX> 543.32 545.42 -0.39% +10.57%
***************************** BONDS **************************
Yield Yield Spread Daily
(bid) change vs Bund change in
Czech Republic spread
2-year
5-year
10-year
Hungary
3-year
5-year
10-year
Poland
2-year
5-year
10-year
******************* FORWARD RATE AGREEMENTS ******************
3x6 6x9 9x12 3M interbank
Czech Rep
Hungary
Poland
Note: FRA quotes are for ask prices
**************************************************************
(Reporting by Reuters buros; Editing by Larry King)
By Ivana Sekularac