The whole curve moved up by 3
bps. A slump of German Bunds inspired the
price action the most. However, the Czech
bonds are reluctant to fall deeper, as no
interest rate hike may occur in the first half
2006 in the Czech Republic.
Today no domestic event is on the agenda.
Thus the market may watch core markets as
usual. The market may catch up yesterday
losses of Bunds and Treasuries, thus the
direction might be again toward higher
yields. Strengthening koruna is a positive
factor, which may help the bonds to resist
negative influence of core markets.
(CSOB - Investment research)