By Anita Komuves BUDAPEST, Aug 2 (Reuters) – The Prague stock index outperformed the region and hit an almost 10-year high on Monday, buoyed by bank stocks which firmed after the Bank’s governor Czech national, Jiri Rusnok, said lenders could pay dividends. The Prague index gained 0.9%, reaching its highest level since September 2011. Shares of Erste / Ceska Sporitelna rose 1.89% to 0904 GMT while Société Générale’s Komercni Banka gained 2.00%. 38%. Elsewhere, Budapest stocks strengthened 0.24% while Warsaw rose 0.2%. The Bucharest index added 0.45%. Currencies in the region were mixed, as PMI data showed manufacturing activity in Central and Eastern Europe rose sharply in July. The Hungarian forint extended its gains from last week which began after the central bank raised its key rate by 30 basis points to 1.2% to fight inflation. Headline inflation accelerated to 5.3% year-on-year in June from 5.1% in May. Hungarian inflation could slow to around 3% next year if the central bank uses the monetary tools at its disposal, Finance Minister Mihaly Varga said in an interview published on Monday. The deputy governor of the National Bank of Hungary, Barnabas Virag, reaffirmed Monday at a conference that the bank wants to control inflation and restore price stability as quickly as possible. “The forint continues to strengthen as the market seems to believe there will be more rate hikes, and Varga and Virag’s comments today helped reaffirm this,” said an FX trader in Budapest. The forint was up 0.31% on the day and traded at 356.70 against the common currency. Rating agency Fitch confirmed Hungary’s rating at ‘BBB’ on Friday with a stable outlook. The Polish zloty was up 0.1% and traded at 4.5615 after surging on Friday after higher than expected inflation data raised expectations of tightening in the country where policymakers have until now resisted the normalization of rates. Elsewhere, the Czech crown edged down 0.05% to 25.504 per euro. CEE SNAPSHO AT MARKETS T 1109 CET CURRENC IES Last daily change previous change of offer close in 2021 EURCZK = Czech EURHUF = Hungary 0 EURPLN = Polish EURRON = Romania EURHRK = Croatia EURRSD = Serbian 0 Note: calculated from 1800 change CET daily Last daily change previous variation close in 2021 .PX Prague 1220.29 1209.450 + 0.90% +18.80 0% .BUX Budapes 48726.7 48610.95 + 0.24% +15.72 t 0% .WIG20 Warsaw 2257.86 2253.45 + 0.20% +13.80% .BETI Bucare 11902.1 11848.61 + 0.45% +21.38 st 0% .SBITOP Ljublja <.sbitop na> % .CRBEX Zagreb 1954.41 1948.31 + 0.31% +12.37% .BELEX1 Belgrad <.belex1 e> .SOFIX Sofia 571.88 570.44 + 0.25% + 27.79% Yield Yield Spread Daily variation (bid) vs Bund variation of Czech spread Republished CZ2YT = R s CZ5YT = R s CZ10YT = s Poland PL2YT = R s PL5YT = R s PL10YT = s FORWARD 3×6 6×9 9×12 3M Czech interbank 1.30 1.70 1.95 0.76 Hungary Rep 1.98 2.17 2.30 1.35 Poland 0.35 0.54 0, 70 0.21 ******************************************* *** **** ********** (Additional reporting by Robert Muller in Prague; Editing by Angus MacSwan)