By Gergely Szakacs BUDAPEST, September 20 (Reuters) – The Hungarian forint fell to its lowest level in six weeks before Tuesday’s crucial central bank meeting, as regional stock markets were hit by the debt crisis Evergrande in China, which curbed appetite for riskier assets. At 8:08 am GMT, the forint was trading down 0.1%, recovering from an earlier drop of around 0.2%. The Czech crown, which like the forint has so far benefited from the central bank rate tightening, lost 0.13% at the start of the session. “The overall negative (market) sentiment took the EURHUF exchange rate to the 50 and 100 day moving averages in a much larger movement than that seen for the Czech koruna and Polish zloty,” brokerage firm Erste said. Investment in a note. . “These levels could halt the forint’s losses for now.” Regional stock markets were all in the red, with Warsaw stocks leading losses dropping 2.3%. The forint and the krone still dominated the region with gains of around 3% each for the year, as central banks in Budapest and Prague began to hike rates in June to combat mounting inflationary pressure the following day. of the pandemic. Hungary’s central bank is meeting on Tuesday to discuss interest rates amid high uncertainty over the size of its next rate move, after a combined 90 basis point hike in its policy rate over the years. last three months at 1.5%. Economists polled by Reuters expect the bank to raise its key rate by 25 basis points to 1.75% on Tuesday. However, the forecast for the move projects four possible outcomes – a 15 basis point increase, 20 basis point, 25 basis point and a 30 basis point increase. A currency trader in Budapest said the Evergrande debt crisis could also complicate Tuesday’s decision, as the weakness of the forint would justify tighter policy, while a possibly more fragile global economy could support the further quantitative easing. “Even though the cycle of rate hikes is expected to continue, possibly with smaller steps, their precise size is unclear,” Erste Group said in a note. “In addition, it will be interesting to see the National Bank’s new inflation and growth forecasts, which may offer a more detailed picture of the trajectory expected in the near future.” The zloty, which has underperformed the krone and the forint in recent months due to the polish central bank’s dovish stance on inflation, eased 0.2% and may come under further pressure in the future. due to a key court ruling released later this week. “The decision of the Constitutional Court expected this week (Wednesday), which will rule on the primacy of Polish law over European law, remains a source of uncertainty,” Bank Millennium said in a note. “Until then, we expect continued increased pressure on the zloty.” CEE SNAPSHO AT MARKETS T 1008 CET CURRENC IES Last daily variation of offer closing in 2021 EURCZK Czech EURHUF Hungary 0 0 EURPLN Polish EURRON Romanian EURHRK Croatian EURRSD Serbian 0 0 Note: calculated from 1800 daily variation CET Last daily variation of closing in 2021 .PX Prague 1,290.29 1,305.24 -1.15% +25.62 00% .BUX Budapest 51488.8 52 376.9 -1.70% +22.28 6 1% .WIG20 Warsaw <.wig20> % .BETI Bucares 12,263.4 12,315.7 -0.42% +25.07 t 8 7% .SBITO Ljubljan <.sbito p a> % .CRBEX Zagreb <.crbex> % .BELEX Belgrade <.belex> .SOFIX Sofia <.sofix> % Yield Yield Spread Daily variation (bid) vs Bund variation of Czech spread Republic CZ2YT = 2 years CZ5YT = 5 years CZ10YT s Poland PL2YT = 2 years s PL5YT = 5 years s PL10YT s FORWARD 3×6 6×9 9×12 3M interbank Czech Hungary Poland ** ****************************** ****************** (Report by Gergely Szakacs; Editing by Devika Syamnath)