CEE MARKETS-Central bank pushback against lending reform reins in forint from three-month lows

By Boldizsar Gyori BUDAPEST, Jan 25 (Reuters) - Hungary's forint rebounded from three-month lows on Thursday after the central bank said the government's plan to replace Budapest interbank rates with Treasury bill yields as the main reference rate for loans was "misguided." The forint firmed 0.51% on the day, outperforming regional peers and trading at 385.4 per euro at 0918 GMT. Hungary's central bank said a recent government proposal to replace Budapest interbank rates with Treasury bill yields as the main reference rate for loans was misguided and it harmfully narrowed the room for policy manoeuvre. "We think the forint overperforming in the region is due to the central bank's criticism of the government's latest reform proposal," Zoltan Arokszallasi, an analyst at Equilor said. The bank's comments came after an Economy Ministry proposal published on Monday that suggested applying Treasury bill yields as the benchmark lending rate for corporate loans to curb borrowing costs and stimulate economic growth. "Such misguided measures and ad hoc ideas -- such as the current plan to replace BUBOR -- only harmfully narrow the room for manoeuvre in economic policy and complicate the achievement of longer-term objectives," the bank said. Elsewhere in the region, investors waited for the European Central Bank's decision, gauging the timing of the first rate cut, with rates expected to remain unchanged. "The ECB's narrative will probably influence market expectations regarding the first rate cut," Bank Millennium said in a note. The Polish zloty traded at 4.38. "In our opinion, however, the EUR/PLN exchange rate will remain in the range of 4.34-4.41, although the postponement of the prospect of quick rate cuts in the eurozone may strengthen the euro and move the EUR/PLN exchange rate closer to the lower limit of this range." CEE SNAPSH AT MARKETS OT 1018 CET CURREN CIES Latest Previo Daily Change us bid close change in 2024 EURCZK Czech 0 0 EURHUF Hungary 00 00 % EURPLN Polish % EURRON Romania % EURRSD Serbian 00 00 % % Note: calcula 1800 daily ted CET change from Latest Previo Daily Change us close change in 2024 .PX Prague 1448.6 1446.4 +0.15 +2.45 8 400 % % .BUX Budapes 64187. 64128. +0.09 +5.88 t 07 40 % % .WIG20 Warsaw <.WIG20 2202.6 2213.3 -0.48% -5.99% > 4 6 .BETI Buchare 15245. 15234. +0.07 -0.82% st 66 98 % Spread Daily vs change Bund in Czech spread Republi c CZ2YT= ps CZ5YT= ps CZ10YT ps Poland PL2YT= ps PL5YT= ps PL10YT ps FORWARD 3x6 6x9 9x12 3M interb ank Czech Hungary Poland Note: are for ask FRA prices quotes **************************************** ********************** (Reporting by Boldizsar Gyori in Budapest; Editing by Shweta Agarwal)