Central Europe's main currencies are expected to firm up against the euro in the next six to 12 months, although the European debt crisis remains a threat, a Reuters poll of analysts showed on Thursday.
Only the safe-haven Czech crown has escaped falls that have brought down the region's currencies by as much as 5 percent since April as concerns over Hungary and Romania's budgets and debt have amplified the impact of global waves of risk aversion.
The consensus view of the 40 participants in the July 5-7 poll was for weaker gains in the region's currencies against the euro over the next 12 months than they had forecast a month ago.
But the units are still expected to gain up to 8 percent by July 2011, with Poland's zloty and the crown firming to above 2010 highs. According to the median forecast in the poll, the zloty is expected to strengthen 8 percent versus the euro from Wednesday's close to 3.8, slightly weaker than the 3.75 median projection a month ago.
"Provided fiscal concerns over peripheral eurozone countries do not escalate, the Polish currency may gain in the autumn, as the data on economic activity in Poland will be supportive and the Polish MPC (central bank) will start interest rate hikes," said Radoslaw Cholewinski of Noble Bank in Warsaw.
Poland's robust economy is seen as having the strongest recovery potential in Central Europe, but the zloty - the region's most liquid currency - has shed 4 percent since April, while Hungary's forint has lost 5 percent and Romania's leu has slipped 2.5 percent.
The crown, which has firmed slightly, is expected to strengthen about another 4 percent in the next 12 months to 24.5, unchanged from the forecast a month ago, even though in the next few months it is seen staying close to current levels.
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