Crown bucks rebound, weakest since removal of its cap

The Czech crown, however, eased past 26.8 against the euro, reaching its weakest levels since the Czech central bank removed its cap on the currency on April 6.

The Hungarian forint, after touching 4-month lows at 313.81 against the euro on Monday, firmed 0.3 percent to 312.85 by 0831 GMT.

Appetite for emerging market assets in general got a lift from the victory of the "Yes" vote in Turkey's referendum, but remaining political uncertainty in Turkey and elsewhere in the world abounds.

"There is Korea, the Turks and also the upcoming French elections," one Budapest-based currency dealer said, adding that jolts in the euro/dollar cross also blurred the outlook.

The market risks, including the first-round French presidential election on April 27, could weigh on Romania's leu , which also firmed slightly on Tuesday, ING analysts said in a note.

"The unease is caused by the fact that some (French presidential) candidates are vocally anti-EU," they said.

The region's main stock indices quickly retreated after an initial rise.

The Czech crown traded at 26.794 against the euro, off an early low at 26.812 but weaker by half a percent from Monday.

The currency peaked at 26.5 last week, after the central bank removed the cap which had kept it weaker than 27 since 2013.

The size of those gains disappointed most investors who had bought tens of billions of euros worth of crowns, speculating on a surge after exit from the cap.

A recent Reuters poll of analysts projected that the strength of the Czech economy could boost the crown to 25.7 by end-March 2018, but many analysts hoped for opportunities to close their euro selling positions earlier, with bigger profits.

"Short position investors are waiting for 26.20. No one is closing positions at these levels, long-term it is going (to strengthen) so why stop it here," one Prague-based dealer said.