Against the backdrop of soaring CDS spreads for the likes of Greece, Portugal and Spain, certain central European countries–namely Poland and the Czech Republic–continue to garner increased attention from investors looking to flee risk but still earn appreciable yield.  As Dominik Radziwill, Poland’s deputy finance minister, who helped place a €3bn 15-year bond issue last month, told the FT on Friday, “we are a safe haven.  We have become an alternative for investors who are looking at the periphery of Europe.  We can see an increase in interest on the part of foreign investors in Polish debt.”

Some observers tout the virtues of Polish debt both in the short and long term.  According to Baron Chan, an emerging-market strategist with Credit Suisse Group AG in London, in regards to the government’s vow to limit spending growth and speed up asset sales in order to bring the budget deficit in line with euro-adoption standards, “the idea of acceleration in fiscal consolidation will be good for the risk profile of Poland and should support the zloty.”  Credit Suisse, for one, anticipates the euro/zloty, now at 4.11, to trade around 3.75 by year end.  Meanwhile, Investec Asset Management touts the long end of Poland’s yield curve, noting thje country’s “good fundamentals and flows supporting bonds.”  In particular, some analysts forecast the 10-year Polish bond yield to fall around 30 basis points in the first half of 2010 from 6.1%.

As for the PIGS label, it seems Ireland has replaced Italy, for those keeping tabs on the acronym.