CEE MARKETS-Crown eyes two-year high, forint softer as FX, stocks hold ground

PRAGUE, Jan 5 (Reuters) - Hungary's forint eased, the Czech crown inched toward a more than two-year high, while other currencies in central Europe clung to stronger ground on Monday, with investors assessing U.S. military action in Venezuela, a dollar rally and data.

Stock markets in central Europe, among the biggest risers in Europe in 2025, sputtered, although Budapest rose around 2% after re-opening following a public holiday to begin 2026.

The dollar's rise against the euro - central Europe's reference currency - mostly dragged on currencies.

Global investors were focused more on upcoming U.S. data than Venezuela, after the latest figures suggested a slowing of U.S. interest rate cuts.

Oil prices dipped after a dramatic weekend in which the U.S. captured Venezuelan President Nicolas Maduro and U.S. President Donald Trump said he was putting the South American nation under temporary American control.

The commodity impact could ease inflation pressures in central Europe where persistent price pressures have kept the region's central banks cautious on rate cuts.

CROWN AND FORINT STILL IN SIGHT OF HIGHS

The crown EURCZK= was a main mover on Monday, rising 0.2% to 24.129 to the euro, inching toward its 27-month high of 24.10 hit in December. Analysts expected attention turning to local data this week to assess chances of a rate move this year.

Czech central bank governor Ales Michl said on Sunday the bank would remain strict in its policy. The bank paused an easing cycle after its last cut in May last year.

December inflation data and the minutes of the central bank's December 18 policy meeting will be released this week, which might curtail bets of Czech rate hikes happening later in 2026.

"In the short term, we see a risk of a correction of gains from the end of last year across the region, given the strong rally in rates and further potential for rate cuts," ING said.

Hungary's forint EURHUF= eased 0.2% to 383.75 per euro, falling after gaining the past six sessions. It had hit a nearly two-year high near 380 last month.

In Poland, where the central bank has been cutting rates while others stay on hold, the zloty EURPLN= was flat at 4.2095, sticking to the strongest end of long-held range around 4.25.

PKO BP bank said global factors may play a bigger role for the zloty to start this year, but the situation in Venezuela was unlikely to have a sharp negative impact in the short run.

"Potential declines in oil prices could, in our opinion, even strengthen the global risk-on mode," it said.