WARSAW, Oct 8 (Reuters) - The Polish zloty held steady on Wednesday as some investors saw a chance of Poland's central bank cutting rates later in the day, while Hungary's forint clawed back some losses following government pressure on its central bank to loosen policy. The zloty, which has been mostly rangebound in recent months, was unchanged at 4.2530 to the euro by 0849 GMT. The National Bank of Poland (NBP) is expected to hold off on further easing of its key interest rate, currently at 4.75%, according to 18 out of 30 respondents in a Reuters poll. The bank may want more data amid the government's forecast of a higher-than-expected deficit and debt path, they said. However, the remaining respondents expected a 25-basis-point cut, while some of those leaning towards 'no change' too said a cut was possible on account of September inflation data and on the back of an extended energy price freeze. Santander Bank Polska analysts said the zloty could firm past the 4.25 level if the NBP chose to hold rates, but added a strengthening U.S. dollar could drag it, and other central European currencies, down. In Romania, the leu was also flat at 5.0990 ahead of its central bank's rate decision, scheduled on Wednesday. The National Bank of Romania (NBR) is expected to keep it on hold at 6.50% after two rate cuts last year, as government tax hikes and savings measures come into effect amid close to 10% inflation. The forint gained 0.3% and traded at 392.45 per euro, off a four-week low of 393.80 hit in early trade after government criticism on rate levels. The currency fell from 16-month peaks after Prime Minister Viktor Orban on Monday said the country's 6.50% key interest rate, the joint-highest in the European Union, was "higher than it could be." But with evidence of inflation risks, analysts expect the rate to be unchanged. "We see a growing likelihood that the key interest rate will remain unchanged at 6.50% for a significant part, or even all of 2026," ING economist Peter Virovacz said. "The reason for this is that over the next one to two years, the Hungarian economy may be hit by shocks that clearly carry inflationary risks — such as government-driven demand stimulation affecting household finances, the phasing out of price margin caps, and the double-digit increase in the minimum wage." Hungary's inflation steadied outside the central bank's target of 3% plus or minus one percentage point in September, running at an annual 4.3% for the third successive month, data showed on Wednesday. Elsewhere, the Czech crown edged 0.1% higher to 24.3640 per euro, while 10-year bond yields were steady around 4.50%, off highs of 4.58% seen before a weekend election won by Andrej Babis's populist ANO party, raising expectations of fiscal policy loosening. Deficit levels fell below the EU's 3% ceiling last year. "Such fiscal policy loosening would likely incur moderately higher fiscal deficits compared to current projections. Nonetheless, we expect EU fiscal rules to serve as an anchor for fiscal policy," analysts at ratings agency Morningstar DBRS said. CEE MARKETS SNAPSHOT AT 1049 CET CURRENCIES Latest Previous Daily Change in trade close change 2025 Czech 24.3640 24.3800 +0.07% +3.47% crown Hungary 392.4500 393.6000 +0.29% +4.84% forint Polish 4.2530 4.2530 +0.00% +0.56% zloty Romanian 5.0990 5.0990 +0.00% -2.40% leu Serbian 117.0800 117.1700 +0.08% -0.11% dinar Note: daily change calculated from 1800 CET STOCKS Latest Previous Daily Change in close change 2025 Prague 2363.27 2358.8300 +0.19% +34.26% Budapest 101804.8 101345.95 +0.45% +28.34% 7 Warsaw 2864.05 2868.67 -0.16% +30.66% Bucharest 21559.39 21524.96 +0.16% +28.94% BONDS Yield Yield Spread Daily (bid) change vs Bund change in spread Czech Rep s Czech Rep s Czech Rep s Poland s Poland s Poland s FORWARD RATE 3x6 6x9 9x12 3M AGREEMENTS interbank Czech Rep 3.56 3.56 3.58 3.53 Poland 4.24 3.97 3.82 4.69 Note: FRA quotes are for ask prices (Reporting by Karol Badohal in Warsaw, Anita Komuves and Gergely Szakacs in Budapest, Jason Hovet in Prague; Editing by Harikrishnan Nair) (The article has been published through a syndicated feed. Except for the headline, the content has been published verbatim. Liability lies with original publisher.)
