WARSAW, May 29 (Reuters) -The Polish zloty pulled back slightly on Wednesday from its highest in more than four years, swayed by global factors, with a May inflation reading smack on target offering little impulse, as Polish rate-setters hold onto stable rates policy.

Polish consumer inflation (CPI) in May inched up to 2.5% year-on-year, the mid-point of the central bank's target, and 0.1% on the month, both figures below all analyst forecasts in a Reuters poll.

By 0907 GMT the Polish zloty EURPLN= eased 0.1% against the euro to 4.2540, after briefly hitting 4.2470, its strongest level since Feb. 2020, on Tuesday.

Asked whether the CPI data impacts the zloty, a Warsaw-based trader said "theoretically it should, because if the figures are lower it suggests that there is a greater chance for interest rate cuts."

"But here it seems to me that it is mainly global factors, such as the fact that the dollar has firmed."

A stronger dollar usually spells weaker investor sentiment towards riskier assets, such as emerging market currencies.

According to Bank Millennium markets analyst Mateusz Sutowicz, "macro data from the domestic economy are not particularly exciting at the moment, because they do not change the (monetary policy) council's view, so we do not expect local events to affect the zloty.

The National Bank of Poland has kept rates on hold since October 2023 and signalled further pause through the end of

2024, citing uncertainties in the upcoming quarters.

Sutowicz added that inflation readings from the Eurozone and the U.S. could make Friday's session more exciting and that he didn't expect "fireworks" for the zloty today ahead of the public holiday in Poland on Thursday.

In Hungary the forint EURHUF= slipped 0.2% to 385.05 per euro, pulling away from the 382.90 hit on Tuesday, its strongest standing since early February.

"The forint is trading sideways these days, an overall positive sentiment in emerging markets and an attractive carry trade giving it a backing," a Budapest-based trader said.

"I expect the currency to trade in the range between 380-388."

In Prague, the crown EURCZK= was 0.1% lower at 24.70, trading within its range since mid-May around 4-1/2-month highs.

Reporting by Karol Badohal in Warsaw, Boldizsar Gyori in Budapest; Editing by Alexandra Hudson

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