Poland's and Slovenia's annual inflation rose to 1.7 and 1.6 percent respectively, from 1.2 and 1.3 percent in February.

The zloty had shed 0.1 percent against the euro by 1008 GMT, drifting through the 4.3 psychological level to 4.3015.

The euro itself was set for its worst month since October after weak data from Germany, central Europe's key export market, and dovish signals from the European Central Bank in recent weeks.

If inflation and interest rates stay at their current low levels in the euro zone and the United States, there will be less pressure on central banks in the European Union's eastern wing to increase their own rates.

The rise in Polish inflation to inside the central bank's 1.5-3.5 percent target range was driven by food and fuel price increases. But the lift could be temporary as the 2018 base figures used for comparison will rise in the April-August period, said Monika Kurtek, chief economist at Bank Pocztowy.

"The low level of inflation, combined with the still high rate of economic growth, will induce the (Polish central bank) to maintain long-term interest rates at current (record low) levels," she added.

Piotr Bielski, head of economic research at Santander Bank Polska noted that the rise in core inflation could continue, while a rise in government spending ahead of a general election due later this year could strengthen hawks in the central bank.

Polish inflation is, however, well below that of other main countries in the region and the central bank is generally not expected to increase rates this year.

Inflation has been rising across central and eastern Europe this year. That had prompted rate setters to sound a more hawkish rhetoric, although their tone softened this month, similar to communication from the ECB and the US Federal Reserve.

The forint touched 321.2 against the euro, its weakest levels since the middle of January when central bank Deputy Governor Marton Nagy said a rise in core inflation could lead to monetary tightening.

The bank delivered its first hike in more than 7 years on Tuesday, albeit only in the overnight deposit rate.

But after its top officials said the move was a one-off and the tightening may be even reversed, the forint plunged to levels almost 3 percent below March 20's 11-month high.

Government bond yields, after a falling in recent weeks, rose marginally across the region, tracking Bunds.

Bucharest's main stock index rose 0.7 percent, after the Romanian government said it would eliminate a cap on natural gas sold to industrial consumers.