UPDATE 1-CEE MARKETS-Polish zloty firms on cenbank's conservative rate cut

(Recasts following Poland's rate decision, adds Budapest-based trader, updates currencies and table) BUDAPEST, Oct 4 (Reuters) - The zloty jumped close to a one-month high as traders found comfort in the Polish central bank's decision on Wednesday to trim rates as expected and not opt for a deeper cut, while the regional peers also firmed. The National Bank of Poland (NBP) cut its main interest rate by 25 basis points to 5.75%, a decision that was in line with analysts' estimates. The zloty, which partly recovered in the past few weeks after a previous shock rate cut, gained nearly 1% after the decision. The unit was trading up 0.6% at 4.6020 per euro, as of 1401 GMT. The majority of economists polled by Reuters had expected the NBP to ease interest rates by 25 basis points, but markets were pricing in the possibility of an even deeper cut ahead of the parliamentary elections and as inflation eases. "The Council did not surprise this time ... and cut rates by 25 bp. This cycle will be as follows: in small steps, not at every meeting and taking into account the risks to financial stability (PLN)," Bank Pekao analysts wrote on X, formerly known as Twitter, predicting a 5.5% reference rate at year-end. The decision could slightly boost the zloty as recent expectations had moved toward the possibility of a deeper cut, ING Bank Slaski analysts said in a comment posted on X. The Hungarian forint pared some gains to trade up 0.5% at 387.90. On Tuesday, the currency was initially boosted by reports that Hungary could finally get billions of euros worth of EU funds unblocked soon, but investors turned cautious and were also considering a larger-than-expected budget deficit. "In fact, shorters reopened their positions, and the euro-dollar also corrected after yesterday's strong dollar and high U.S. yields. This trend will continue, the market just took a breather," a Budapest-based trader said. "Now the market is looking for a top and a bottom." The Czech crown was up 0.6% at 24.378, bouncing back from its lowest level since mid-September after three straight sessions of losses, continuing a bumpy ride started last month after Poland's shock rate cut knocked it back. The Czech central bank has shown no rush to follow its peers in Hungary and Poland and begin loosening the monetary policy as it stays cautious on taming inflation. CEE SNAPSHOT AT MARKETS 1601 CET CURRENCI ES Latest Previous Daily Change bid close change in 2023 Czech 24.3780 24.5150 +0.56% -0.90% crown Hungary 387.9000 389.8500 +0.50% +2.97% forint Polish 4.6020 4.6305 +0.62% +1.90% zloty Romanian 4.9750 4.9755 +0.01% -0.65% leu Serbian 117.1300 117.1650 +0.03% +0.15% dinar Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2023 Prague 1333.64 1340.230 -0.49% +10.98% 0 Budapest 55739.52 55959.41 -0.39% +27.28% Warsaw 1880.91 1864.31 +0.89% +4.96% Bucharest 14214.09 14359.46 -1.01% +21.87% Spread Daily vs Bund change in Czech spread Republic 2-year 5-year 10-year Poland 2-year 5-year 10-year FORWARD 3x6 6x9 9x12 3M interban k Czech Rep < 6.72 5.83 4.96 7.09 PRIBOR=> Hungary < 10.87 9.56 8.41 12.21 BUBOR=> Poland < 5.05 4.60 4.43 5.73 WIBOR=> Note: FRA are for ask prices quotes ************************************************** ************ (Reporting by Boldizsar Gyori in Budapest and Karol Badohal in Warsaw; Editing by Sherry Jacob-Phillips)