* FTSE index change helps to lift Polish stocks * Hungarian bonds rise despite FX bond issue * Investors await Fed comments from Wednesday meeting (Recasts on firmer Polish stocks and zloty, rise in Hungarian bond yield) By Sandor Peto BUDAPEST, Sept 25 (Reuters) - Warsaw's blue-chip share index set a three-week high on Tuesday, helped by the reclassification of Polish shares to "developed market" from "advanced emerging" within FTSE global indexes. Eight Polish shares were also added this week to the STOXX Europe 600. Warsaw outperformed both that index and all Central European peers, except for Prague, rising 1.1 percent by 1400 GMT. More than half of the index gains stemmed from gains for PKO BP, Poland's biggest lender, and PKN Orlen, its biggest oil company. The stocks both were added to the STOXX Europe 600 index on Monday. The bank's Deputy CEO Jakub Papierski was quoted by Polish news agency PAP as saying that the advance of Warsaw stocks into FTSE's developed-market basket was "very important for PKO" but also improves perception of Poland as a "stable, developed country with low volatility". The zloty currency firmed by 0.2 percent against the euro while Hungary's forint, which usually moves in tandem with the Polish currency, eased by 0.3 percent in thin trade, hitting a one-week low against the zloty. Hungary's 10-year government bond yield rose 2 basis points to 3.6 percent, in line with its Polish peer, which was bid at 3.284 percent. They tracked a rise in the corresponding 10-year U.S. Treasury yield above 3.1 percent and a rise in Bund yields after European Central Bank chief Mario Draghi predicted a vigorous pick-up in euro zone inflation. One Budapest-based bond trader said the yield rise also reflected some expectations that the Federal Reserve might predict steeper-than-expected future interest rate increases at its meeting on Wednesday. Hungarian government bonds have received some support this week from a rare foreign currency bond issue by the government. It launched a sale of a seven-year euro-denominated benchmark bond on Tuesday, with demand exceeding 2 billion euros ($2.36 billion), the IFR financial news service said. The positive impact faded on Tuesday because of uncertainty over European Union fund inflows, the trader said. Hungary may lose European Union funds worth up to $1.8 billion because of a dispute with the European Commission, news website G7.hu said on Tuesday, citing a government report. CEE SNAPSHOT AT MARKETS 1600 CET CURRENCI ES Latest Previous Daily Change bid close change in 2018 Czech <EURCZK= 25.6290 25.6180 -0.04% -0.34% crown > Hungary <EURHUF= 324.5300 323.6000 -0.29% -4.20% forint > Polish <EURPLN= 4.2924 4.2991 +0.16% -2.70% zloty > Romanian <EURRON= 4.6620 4.6580 -0.09% +0.38% leu > Croatian <EURHRK= 7.4290 7.4255 -0.05% +0.02% kuna > Serbian <EURRSD= 118.3500 118.2400 -0.09% +0.13% dinar > Note: calculated from 1800 CET daily change Latest Previous Daily Change close change in 2018 Prague 1105.58 1093.460 +1.11% +2.54% 0 Budapest 35833.24 35786.54 +0.13% -9.00% Warsaw 2304.80 2280.60 +1.06% -6.36% Bucharest 8337.88 8377.37 -0.47% +7.53% Ljubljana <.SBITOP 848.08 857.27 -1.07% +5.17% > Zagreb 1797.04 1810.29 -0.73% -2.49% Belgrade <.BELEX1 727.75 730.56 -0.38% -4.22% 5> Sofia 624.83 623.48 +0.22% -7.77% BONDS Yield Yield Spread Daily (bid) change vs Bund change in Czech spread Republic 2-year <CZ2YT=R 1.5650 0.0980 +209bps +10bps R> 5-year <CZ5YT=R 1.9270 0.0570 +202bps +4bps R> 10-year <CZ10YT= 2.2310 0.0120 +170bps -1bps RR> Poland 2-year <PL2YT=R 1.5700 -0.0130 +209bps -1bps R> 5-year <PL5YT=R 2.5700 0.0140 +266bps +0bps R> 10-year <PL10YT= 3.2840 0.0180 +275bps +0bps RR> FORWARD RATE AGREEMEN T 3x6 6x9 9x12 3M interban k Czech Rep 1.95 2.14 2.26 1.57 <PRIBOR= > Hungary 0.41 0.65 0.92 0.19 Poland 1.77 1.82 1.87 1.72 Note: FRA are for ask prices quotes ************************************************* ************* ($1 = 0.8488 euros) (Reporting by Sandor Peto Editing by Alison Williams and David Goodman)