(Updates with Czech rate hike, market reaction) By Anita Komuves BUDAPEST, June 22 (Reuters) – The Czech koruna eased on Wednesday after the central bank raised the key repo rate to two weeks down 125 basis points to 7%, continuing its year-long cycle of hiking in an attempt to rein in soaring inflation. The krone slipped after the decision and was trading down 0.21% on the day at 24.742 against the euro. Analysts in a Reuters poll were widely split on whether the bank would go for a 100 or 125 basis point hike, while financial markets were expecting a move as big as 150 basis points. Governor Jiri Rusnok was due to comment on the rate decision at 13:45 GMT at a press conference. It was the last CNB meeting before new Governor Ales Michl took over. Michl has consistently voted against rate hikes during the central bank’s one-year tightening cycle, which raised the policy rate by a total of 550 basis points. However, his promise not to raise rates again will be immediately tested by soaring inflation and a hawkish turn by major central banks. Elsewhere, currencies and stocks fell, influenced by global markets as worries about rising interest rates and recession hit again. The Hungarian forint weakened 0.65% to 397.00 per euro, while the Polish zloty plunged 1.34% to trade at 4.700 against the common currency. “A regional source of volatility today could be the Czech central bank meeting,” Bank Millennium wrote. “Locally, this may also be a source of additional pressure on the Polish Monetary Policy Council, but we do not believe it is so strong that it can significantly affect the valuation of Polish assets.” Shares in the Central European region fell, with the Warsaw index down 2.71% while Budapest weakened 2.11%. Prague lost 0.74% and Bucharest fell by 0.61%. ECO SNAPSH AT MARKETS OT 1528 CET CURREN CIES Last previous daily supply change at close in 2022 Czech 0 0% Hungary 00 00 Polish Romania % Croatia % % Serbian 00 00 % % close change in 2022 Prague 1308.9 1318, 7 -0.74% 5,700 Budapes 40074. 40936. -2.11% -20.99 t 93 77% Warsaw <.wig20> 1 5% Bucharest 12301. -1237% 5.82% st 74 09 Ljublja <.sbito na p> 5 2 Zagreb <.crbex> 6 6% Belgrade <.belex e> % Sophia <.sofix> Yield Yield Spread Daily (bid) change vs change Bund in Czech spread Republi c 0 ps 0 ps 0 ps Poland 0 ps 0 ps 0 ps FORWARD 3×6 6×9 9×12 3M interb ank Czech Hungary Poland *********************************** ** ************* ********* (Additional reporting by Pawel Florkiewicz in Warsaw; Editing by Sherry Jacob-Philli ps and Emelia Sithole-Matarise)