(Updates with Hungarian bond purchase results, market prices) By Anita Komuves and Jason Hovet BUDAPEST/PRAGUE, May 5 (Reuters) - Central European currencies climbed on Tuesday after risk appetite strengthened on some global easing of lockdown measures, while Hungary's central bank kicked off its bond-buying scheme in a bid to flatten the yield curve. Stock markets rose as much as 1.6%, with Prague leading gains as several countries including Spain, Italy, India and Malaysia tentatively eased lockdowns and governments in central Europe continued to roll back such measures. The Prague market was boosted by a more than 5% jump in tobacco group Philip Morris CR after the Czech-based company proposed paying a dividend from last year's profit that amounted to an 11% yield against Monday's closing price. Also helping were gains in shares of MONETA Money Bank , up 2.75%, after the Czech lender reported first-quarter earnings and said it would return to dividend payments as quickly as possible. The Hungarian central bank held the first tender of its new asset-buying programme on Tuesday, buying 50 billion forints ($154.15 million) worth of government bonds. The bank has said it could buy up to 100 billion forints worth of bonds per week, as it launched the purchases to drive longer-dated government debt yields down. Long-term yields have dropped since the central bank announced its plans last Tuesday. Yields edged up on shorter-date bonds after the first auction. "The results suggest that the flattening on the long end of the curve might continue," a Budapest trader said. "We need a few weeks for the market to adjust and settle." Another trader said the central bank could be in secondary markets in the coming days, adding the lower amount sold meant some players missed out and that added some "sell-side pressure". The Hungarian forint firmed 1.1% to 350.10 to the euro and the Polish zloty was up over half a percent. The Czech crown gained 0.3% to test the psychological 27 per euro level ahead of a central bank meeting this week, where analysts expect the bank to cut rates for a third time since the novel coronavirus outbreak started in March. The central bank, which cut rates by a total of 125 basis points in March, is now expected to cut rates by 50 basis points at the policy meeting on Thursday. The outbreak and lockdown measures by countries to fight the spread have hammered central Europe economies, with analysts expecting an economic plunge in 2020 after several years of solid growth. Manufacturing surveys (PMI) across central Europe on Monday showed a grim picture, although some analysts see a bottom being reached as economies return to life with governments around the region starting to ease restrictions. "We believe ... April PMI will prove to be the very bottom as restrictions are slowly, but surely being lifted, and we should therefore see some improvement in May already," Raiffeisen said commenting on the Czech data. ** For an interactive graphic on expected GDP developments in Central Europe: reut.rs/3exsJHO?eikon=true CEE MARKETS SNAPSHOT AT 1456 CET CURRENCIES Latest Previous Daily Change bid close change in 2020 EURCZK= Czech crown 27.0250 27.1000 +0.28% -5.89% EURHUF= Hungary forint 350.1000 354.0600 +1.13% -5.41% EURPLN= Polish zloty 4.5350 4.5612 +0.58% -6.14% EURRON= Romanian leu 4.8235 4.8301 +0.14% -0.73% EURHRK= Croatian kuna 7.5720 7.5795 +0.10% -1.67% EURRSD= Serbian dinar 117.5400 117.5800 +0.03% +0.03% Note: daily change calculated from 1800 CET STOCKS Latest Previous Daily Change close change in 2020 .PX Prague 876.43 862.9500 +1.56% -21.44% .BUX Budapest 34896.10 34576.84 +0.92% -24.28% .WIG20 Warsaw 1600.81 1600.65 +0.01% -25.55% .BETI Bucharest 8079.79 7992.41 +1.09% -19.02% .SBITOP Ljubljana 796.68 793.12 +0.45% -13.95% .CRBEX Zagreb 1529.91 1525.46 +0.29% -24.17% .BELEX15 Belgrade 662.85 665.81 -0.44% -17.32% .SOFIX Sofia 447.96 447.74 +0.05% -21.15% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech Republic spread CZ2YT=RR 2-year 0.5980 0.0560 +138bps +9bps CZ5YT=RR 5-year 0.8590 -0.0120 +163bps +1bps CZ10YT=RR 10-year 1.3320 0.0760 +190bps +9bps Poland PL2YT=RR 2-year 0.5280 0.0280 +131bps +6bps PL5YT=RR 5-year 1.0360 -0.0030 +180bps +2bps PL10YT=RR 10-year 1.5330 -0.0020 +211bps +1bps FRA 3x6 6x9 9x12 3M interbank Czech Rep 0.30 0.29 0.33 0.90 Hungary 1.18 1.12 1.09 1.09 Poland 0.26 0.28 0.30 0.68 Note: FRA quotes are for ask prices ************************************************************** (Reporting by Jason Hovet in Prague and Anita Komuves in Budapest; Editing by Amy Caren Daniel and Shounak Dasgupta)
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