(Recasts with new prices and comments)
* FX correction is a risk after recent rally
* Currencies gained Weds after ECB liquidity injection
* Poland records strong Q4 GDP, worse than expected PMI
By Radu Marinas and Sandor Peto
BUCHAREST/BUDAPEST, March 1 (Reuters) - Emerging European currencies firmed on Thursday, lifted by Poland's robust growth figures and Wednesday's cash injection by the European Central Bank to markets.
Assets in the European Union's emerging economies shrugged off mixed manufacturing figures and a retreat of the euro against the dollar, which often makes investors avoid risky assets.
The region's safe haven unit, the Czech crown, was bid at 24.752 against the euro at 1552 GMT, firmer by 0.6 percent, after crossing its 200-day moving average of 24.86.
"Closing below (firmer than the moving average) would put us on path to 24.400-500," one Prague-based dealer said.
Poland, Central Europe's biggest economy, reported 4.3 percent annual growth for the fourth quarter of 2011.
The country's zloty was bid at 4.102 to the euro, stronger by 0.4 percent.
Purchasing Manager Index data, however, showed that economic output in the region could remain under pressure from public sector belt-tightening, high unemployment, weak lending and a slowdown in western export markets..
The Czech and Hungarian figures indicated a mild pick-up in economic activity in February, suggesting that a fall in manufacturing may have bottomed out, while the Polish figure just broke even after a surprise rise in January.
Capital Economics said in a note that Poland would continue to outperform in the region and the figures eased fears that Czech and Hungarian industrial output could fall sharply.
But the outlook for export markets in Europe remains bleak.
"As such, output growth in industry and the economy more generally will remain sluggish at best in 2012 across the region," it added.
The crown, the zloty and the forint have firmed 3-9 percent this year. The region's most stable unit, the Romanian leu posted a modest loss, being bid at 4.348, flat from Wednesday.
The weak economic outlook makes the rebound of the region's currencies fragile, dealers aand analysts said.
In a survey published on Thursday, Hungary's central bank said lending conditions for companies had tightened.
Societe General said in a note that Hungary, which is seeking international financial support, was particularly vulnerable, and recommended investors that they should buy the euro against the forint at 287.80, with an initial target of 300.
The forint was bid at 287.45, firmer by 0.2 percent from Wednesday.
Hungarian government bonds also firmed, with yields dropping by 8-15 basis points. The country's 10-year bonds traded at 8.3 percent and 3-year yields were at 8.08 percent.
Traders said the bonds drew support from the ECB's liquidity injections to European markets, and from hopes that the government will secure and international credit line in the next months.
"I don't rule out that yields dip to below 8 percent, but I would not buy there," one fixed income trader said. "People don't dare to sell as the credit talks may succeed, but the buy side is not strong either due to fears of a failure." --------------------------MARKET SNAPSHOT-------------------- Currency Latest Previous Local Local
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today in 2012 Czech crown 24.752 24.889 +0.55% +3.2% Polish zloty 4.102 4.117 +0.37% +8.84% Hungarian forint 287.45 288.15 +0.24% +9.45% Croatian kuna 7.566 7.567 +0.01% -0.66% Romanian leu 4.348 4.349 +0.02% -0.62% Serbian dinar 110.63 110.61 -0.02% -3.33% Yield Spreads Czech treasury bonds 2-yr T-bond CZ2YT=RR -2 basis points to 112bps over bmk* 7-yr T-bond CZ7YT=RR +3 basis points to +144bps over bmk* 10-yr T-bond CZ9YT=RR +4 basis points to +169bps over bmk* Hungarian treasury bonds 3-yr T-bond HU3YT=RR -11 basis points to +773bps over bmk* 5-yr T-bond HU5YT=RR -7 basis points to +742bps over bmk* 10-yr T-bond HU10YT=RR -14 basis points to +644bps over bmk* *Benchmark is German bond equivalent. All data taken from Reuters at 1652 CET. Currency percent change calculated from the daily domesticclose at 1700 GMT.For related news and prices, click on the codes in brackets: All emerging market news Spot FX rates Eastern Europe spot FX Middle East spot FX Asia spot FX Latin America spot FX Other news and reports World central bank news Economic Data Guide Official rates Emerging Diary Top events Diaries Diaries Index (Reporting by Reuters bureaus; writing by Radu Marinas/Sandor Peto; Editing by Susan Fenton)