WARSAW: Central European currencies were steady early on Friday but were expected to weaken further on concerns about the dismal economic outlook across the region, traders said.
The Czech crown was virtually flat by 0807 GMT after taking a beating on Thursday on the back of poor growth figures and talks about further monetary policy easing.
Czech central bank Governor Miroslav Singer said on Thursday that monetary policy may need to ease further around the middle of 2013 despite already low interest rates.
Some traders also attribute the crown's recent slide to investors' repositioning from the crown into the Hungarian forint and the Polish zloty.
"Should the next batch of economic data disappoint as well, the (euro) is likely to flirt with the upside again where the next resistance levels in the area around 25.63-25.735 (to the crown) are proving very attractive already," analysts at Commerzbank wrote in a research.
"Due to the risk of interventions the lower end is likely to be limited in the area around 25.20."
The forint was up 0.2 percent while the zloty was virtually flat.
"Global stocks are falling, worries over the troubled euro zone are back, and the global political situation is far from certain - all those factors do not support currencies in the region," said a Warsaw-based dealer.
"I'm personally bearish on the zloty, it is slowly weakening though with some corrections, and I think that move will continue even to 4.25 to the euro."
Data on Thursday showed that much of central and eastern Europe fell deeper into recession in the third quarter while the euro zone, central Europe's main trading partner, slipped into its second recession since 2009. [ ID :nL5E8MFA7E]
The Romanian leu hovered around its previous closing level of 4.535 to the euro.
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