BUDAPEST, Nov 29 (Reuters) - Central European currencies and stocks recovered on Monday, as a global risk-off mood triggered by the newly identified coronavirus variant found in South Africa has faded away. By 1020 GMT, the Hungarian forint led regional gains trading 0.4% firmer on the day at 368.6 to the euro, followed by the Polish zloty, up 0.22% at 4.6990. The Romanian leu and the Czech crown were trading flat at 4.9485 and 25.66 respectively. "Monday may bring an improvement in sentiment after its significant deterioration on Friday, when a wave of sell-offs of more risky assets swept through the market, following information on a new variant of the coronavirus," Bank Millennium said in a note. "The latest reports are reassuring (the symptoms of Omicron - the new form of COVID-19 - are mild and can be treated at home)." An FX trader in Budapest said markets are calming down a bit as more info is coming out about the Omicron variant, "that"s why regional currencies are able to firm. I do not expect a very big correction, but maybe the worst was over on Friday." "The key question for the forint this week is whether the central bank will raise the interest rate on its one-week deposit rate again," she said. Hungary"s central bank raised its one-week deposit rate by 40 basis points to 2.9% on Thursday at its weekly tender, delivering its second increase in deposit rate in a week. read more More volatility, however, cannot be ruled out says Komercni Banka"s Marek Lesko: "Today, the sentiment seems to be improving as the core rates and equity futures are higher, but after such exaggerated moves, more volatility wouldn"t come as a surprise." Stock markets in the CEE region rose, with Prague (.PX) leading regional gains with 0.58%, followed by Budapest <.BUX with 0.46%> and Warsaw (.WIG20) with 0.42%.