* Danish c.bank seen mirroring ECB rate increase this week
* Danes may raise CD rate more than lending rate - analysts
* Extra CD rate rise would be step to rate normalisation
COPENHAGEN, April 5 (Reuters) - Denmark's central bank will move in lock-step with the European Central Bank if the latter raises base interest rates on Thursday, but it might increase a secondary Danish rate more sharply, analysts said.
If, as widely expected, the ECB raised interest rates by 25 basis points on Thursday from a record low 1.0 percent, Denmark's Nationalbank would in turn hike its lending rate by 25 bps from 1.05 percent, where it has been since January 2010.
Economists said that was a "done deal" because Denmark would want to keep the official rate spread to the euro zone steady.
The only uncertainty was whether the Danish bank would opt for an extra increase in its certificates of deposit (CD) rate.
"They might hike (the CD rate) by an additional 5 or 10 basis points as part of the (monetary) normalisation in the market," Danske Bank chief forex analyst Arne Lohmann Rasmussen said.
The CD rate is a secondary rate, which nonetheless has played a role in Danish monetary policy during the financial crisis as the bank began differentiating between the lending rate and the CD rate in June 2009. Before then, they were equal.
The Danish central bank, which aims via its monetary policy to keep the crown currency steady within a narrow band against the euro, subsequently cut the CD rate more steeply than the lending rate because of the strong crown.
In October 2010, the Danish bank independently raised the CD rate twice by 10 bps, to 0.60 percent from an all-time low 0.50 percent and then to 0.70 percent, after Danish short-term market interest rates fell below corresponding European rates.
That negative rate spread had caused the Danish crown to weaken, and the bank moved to curb that weakening with an early tightening move in the CD rate while leaving the gap to the euro zone official rate steady at 5 bps.
Danske Bank's Rasmussen predicted the Danish central bank would raise its lending rate by 25 bps "to follow the ECB, and then raise its CD rate by an extra 5 to 10 basis points."
NORMALISATION OF RATES
The CD rate was earlier lowered by more than the lending rate when Eonia rates started to trade below Danish short-term market rates.
"Now, as we see a certain pressure on Eonia
But Nordea Markets senior analyst Troels Theill Eriksen said his "main scenario" was that the Danish central bank would raise the lending rate and CD rate by the same amount.
While it could not be ruled out that the bank would raise the CD rate by more , "looking at interest rate spreads and the crown, we do not see any real sign that they would do that."
"When the rate spreads were negative and the crown was weak, I would have seen a higher possibility for that," Eriksen said. "They do not need to do that now, and the currency reserves are very high, so they are bolstered."
The bank on Monday said its foreign currency reserves climbed to a record high 453.9 billion Danish crowns ($86.34 billion) in March when it intervened in the forex market with only a small amount - 400 million - to support the crown.
Rasmussen said that the only potential market impact would be on the very front end of the money market curve, and that would be related to whether the bank raises the CD rate by the same amount as the lending rate or by more.
"We don't expect any impact on the currency," he said.
The Nationalbank can change rates at any time and does not say when its policymaking board of governors meets, though its prime time for changing rates is Thursdays at 4 p.m. (1400 GMT).
(Editing by John Stonestreet)