(Updates with Czech cenbank decision, analyst comments, market
reaction)
    By Anita Komuves and Jason Hovet
    BUDAPEST/PRAGUE, Nov 4 (Reuters) - The Czech crown extended
its gains on Thursday after the central bank delivered a
larger-than-expected rate hike amid soaring inflation, raising
its main rate above the level last seen before the pandemic.
    The Czech National Bank raised its two-week repo rate
 by 125 basis points to 2.75%, delivering a hike
that no analyts expected in a Reuters poll. The move comes after
a surprise 75-basis-point hike in September. 
    "The tightening cycle still has some way to go and the risks
to our view for rates to reach 3.25% in 2022 are firmly to the
upside," Liam Peach, economist at Capital Economics, wrote in a
note.
    The crown jumped 0.3% immediately after the
decision and traded 0.41% stronger on the day at 25.43 versus
the euro at 1405 GMT, outperforming its regional peers, which
eased.
    The market was pricing in a hike of about 100 basis points,
a trader in Prague said, which means that "125 basis points were
not that much of a surprise."
    "It looks like rate hikes, even those bigger than expected,
do not have that much of an impact on exchange rates these
days."
    The Polish zloty slid 0.13% to 4.6009 and was
still mildly in the red for the year, failing to benefit from
Wednesday's larger-than-expected 75 basis-point interest rate
hike by the central bank in Poland.
    Based on the "the NBP projecting inflation to remain
persistently high in 2022 and 2023, we now expect a steeper and
more front-loaded hiking cycle that will put the NBP on the same
page with the rest of the CEE central banks," Morgan Stanley
said in a note.
    The Hungarian forint eased 0.26% and was trading
at 359.95 per euro.
    Central banks across Central Europe have been raising rates
since June amid a strong recovery from the coronavirus pandemic
to fend off a surge in inflation driven by global supply
bottlenecks and local factors such as tight labour markets.
    
                   CEE       SNAPSHO   AT                       
                   MARKETS   T        1505 CET           
                             CURRENC                            
                             IES                         
                             Latest   Previous  Daily    Change
                             bid      close     change   in 2021
 EURCZK=  Czech    <EURCZK=  25.4300   25.5330   +0.41%   +3.14%
          crown    >                                     
 EURHUF=  Hungary  <EURHUF=  359.950  359.0000   -0.26%   +0.77%
          forint   >               0                     
 EURPLN=  Polish   <EURPLN=   4.6009    4.5950   -0.13%   -0.91%
          zloty    >                                     
 EURRON=  Romania  <EURRON=   4.9498    4.9495   -0.01%   -1.71%
          n leu    >                                     
 EURHRK=  Croatia  <EURHRK=   7.5230    7.5183   -0.06%   +0.33%
          n kuna   >                                     
 EURRSD=  Serbian  <EURRSD=  117.530  117.5800   +0.04%   +0.03%
          dinar    >               0                     
          Note:    calculated from              1800            
          daily                                 CET      
          change Latest   Previous  Daily    Change
                                      close     change   in 2021
 .PX      Prague             1360.72  1353.830   +0.51%   +32.48
                                             0                 %
 .BUX     Budapes            55450.8  54914.54   +0.98%   +31.69
          t                        1                           %
 .WIG20   Warsaw             2435.15   2380.11   +2.31%   +22.74
                                                               %
 .BETI    Buchare            12913.5  12825.46   +0.69%   +31.70
          st                       7                           %
 .SBITOP  Ljublja  <.SBITOP  1195.87   1188.68   +0.60%   +32.75
          na       >                                           %
 .CRBEX   Zagreb             2013.73   2017.34   -0.18%   +15.78
                                                               %
 .BELEX1  Belgrad  <.BELEX1   793.73    798.25   -0.57%   +6.03%
 5        e        5>                                    
 .SOFIX   Sofia               598.86    598.86   +0.00%   +33.81
                                                               %
                                                                
                             Yield    Yield     Spread   Daily
                             (bid)    change    vs Bund  change
                                                         in
          Czech                                          spread
          Republi                                        
          c                                              
 CZ2YT=R           <CZ2YT=R   2.9010    0.0160   +362bp    +7bps
 R        2-year   R>                                 s  
 CZ5YT=R           <CZ5YT=R   2.8150    0.0420   +336bp   +11bps
 R        5-year   R>                                 s  
 CZ10YT=           <CZ10YT=   2.7240    0.0880   +293bp   +13bps
 RR       10-year  RR>                                s  
          Poland                                                
 PL2YT=R           <PL2YT=R   2.7510    0.4100   +347bp   +47bps
 R        2-year   R>                                 s  
 PL5YT=R           <PL5YT=R   2.8300    0.1660   +337bp   +24bps
 R        5-year   R>                                 s  
 PL10YT=           <PL10YT=   2.9110    0.0000   +312bp    +4bps
 RR       10-year  RR>                                s  
                   FORWARD                                      
                             3x6      6x9       9x12     3M
                                                         interba
                                                         nk
          Czech                 3.68      3.69     3.73     2.22
          Rep      <PRIBOR=                              
                   >                                     
          Hungary               2.88      3.21     3.45     2.06
                                                         
          Poland                2.74      3.09     3.28     0.84
                                                         
          Note:    are for ask                                  
          FRA      prices                                
          quotes                                         
          *********************************************         
          *****************                              
 
  
    
    

 (Editing by Subhranshu Sahu)
  
 
 



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