CEE MARKETS-Forint outperforms, Czech rate hike bets fade

* Forint is buoyed by monetary tightening expectations * Crown is off 12-day high; rate hike bets are reduced * Budapest stocks set record high as OTP Bank rise further By Sandor Peto BUDAPEST, March 19 (Reuters) - The forint tested 10-month highs on Tuesday, buoyed by expectations that the National Bank of Hungary ill tighten policy for the first time in seven years next week.

The forint was up 0.1 percent against the euro at 313.75 by 0919 GMT.

"The forint is lifted by expectations that the NBH will increase the bottom of its rate corridor slightly next week," one Budapest-based currency dealer said.

Expectations for NBH tightening, fuelled by a rise in core inflation, has helped the forint rise 2.3 percent from beyond 320 late last year, making it the region's best performer in 2019.

Czech markets have cut bets on another rate increase on March 28, a day after the NBH's meeting and a day before Britain's scheduled departure from the European Union.

Forward rate agreements indicate only a slim chance of a Czech rate increase next week, a view reinforced on Tuesday by Czech central bank Vice-Governor Marek Mora, who said he saw zero to one rate hikes in 2019 as most likely.

The Czech crown was flat at 25.621 versus the euro, off a 12-day high reached in early trade.

The zloty was weaker against the euro at 4.292, but still near six-week highs it set in overnight trade, unaffected by a higher-than-expected 7.6 percent annual rise in Polish corporate wages.

"We see headwinds from the global side for the next month, but then see a modest recovery in global economy, which should aide the PLN together with the still-solid performance of the domestic Polish economy," Danske Bank said in a weekly note on emerging markets.

Equities gained in the region. Budapest's blue-chip index hit another record high, driven by OTP Bank.

CEE SNAPSHOT AT MARKETS 1019 CET CURRENCI ES Latest Previous Daily Change bid close change in 2019 Czech Hungary Polish Romanian Croatian Serbian Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2019 Prague 1081.13 1076.730 +0.41% +9.59% 0 Budapest 42276.90 42085.01 +0.46% +8.02% Warsaw 2354.20 2345.84 +0.36% +3.41% Bucharest 7888.72 7883.39 +0.07% +6.84% Ljubljana Zagreb 1773.70 1774.12 -0.02% +1.42% Belgrade Sofia 586.36 586.02 +0.06% -1.36% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year 5-year 10-year Poland 2-year 5-year 10-year FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech Rep 2.19 2.25 2.27 2.03 (PRIBOR= ) Hungary 0.35 0.53 0.72 0.14 Poland 1.74 1.74 1.73 1.72 Note: FRA are for ask prices quotes ************************************************* ************* (Additional reporting by Jason Hovet in Prague, editing by Larry King)

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