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PRAGUE: The Hungarian forint and Czech crown edged down on Monday, as markets turned to central bank meetings due this week to gauge how quickly policymakers may begin interest rate cuts this year.

The forint had eased 0.2% by 0825 GMT to sit at 386.0 to the euro, stuck in a range it settled into last week after volatility caused by Credit Suisse being taken over by its Swiss banking rival UBS, along with the implosion of the US Silicon Valley Bank (SVB).

With worries persisting over the global banking system, trading in central Europe remained choppy. Stock markets rose in mixed trade, seeking a return to firming paths.

On the currency front, attention was turned to Tuesday’s Hungarian central bank meeting, with pressure still coming from the government to cut what is the European Union’s highest policy interest rate at 13%.

“The Hungarian central bank meeting will get the most attention, as markets are waiting for any indication on interest rate normalization,” Erste Group Bank said.

“Recent market turmoil and the vulnerability of the Hungarian forint in the aftermath of the troubles of the US SVB bank as well as Credit Suisse bank may, however, delay the beginning of interest rate normalization.”

Global central banks like the US Federal Reserve must now balance concerns over still-high inflation with worry over economies amid potential banking stress.

That could mean steadier interest rates in central Europe, where policymakers have held steady on policy since last year following hiking cycles that started sooner than global peers.

Analysts in a Reuters poll pared back rate cut views in both Hungary and the Czech Republic.

Hungarian rate-setter nominee Eva Buza on Monday said curbing inflation - which has soared to above 20% - as soon as possible was in the national interest.

In Czech markets, the crown inched down a touch to 23.715 to the euro before Wednesday’s rate meeting, where rates will likely stay on hold as in Hungary. The Polish zloty edged 0.1% higher to 4.688 per euro.

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