CEE MARKETS-Forint backs off high as markets await Hungary rate cues

BUDAPEST, Jan 27 (Reuters) - The Hungarian forint eased on Tuesday after hitting a multi-week high in the previous session, ahead of the country's central bank policy announcement that is expected to keep the base rate unchanged.

The forint EURHUF= was 0.2% lower at 382.00 versus the euro, backtracking from a six-week high of 381.05 hit on Monday.

"This is a correction, the forint just firmed a bit too much yesterday," an FX trader in Budapest said.

A Reuters poll showed that the National Bank of Hungary was all but certain to leave its base rate steady at 6.5% on Tuesday, the European Union's joint-highest level, as strong services pricing at the end of last year tempers the case for easing.

However, analysts also now see room for 75 basis points worth of rate easing by the end of 2026, 25 bps more than expected last month.

Earlier, central bank Governor Mihaly Varga had opened the door to a possible rate cut after the bank's meeting in December.

"A renewed (noticeable) re-acceleration of core HICP in the December data could make the central bank turn cautious (more hawkish) again," Commerzbank wrote in a note.

"A more cautious, restrictive tone from Varga will be supportive of forint outperformance, while maintaining last month’s dovish messaging will open up the currency to underperformance."

The bank is scheduled to announce its rate decision at 1300 GMT. A statement and a press conference will follow at 1400 GMT.

Elsewhere, the Polish zloty EURPLN= was a touch up, trading at 4.2045 per euro.

The zloty's rate will be mainly influenced by the dollar, PKO Bank wrote in a note.

Stocks in the region were mixed, with Budapest's equities .BUX up 1% and Prague's blue chip .PX index 0.4% higher. Warsaw's stocks .WIG20 rose 0.2%.