The battle for the level of EUR/CZK 29.80 continued on Czech FX market on Friday

The koruna initially weakened to its two-and-half-month low at 29.845, but quickly rebounded back into seventies. The morning weakness was witnessed at all CE markets. The unit hovered at 29.74-29.81 range in the rest of the day. Friday’s price action pointed out that the koruna still feels some weakening pressure. That mood is likely linked to the nervous atmosphere in the region and waiting for the result of the end-of-month meeting of the central bank. Today the koruna might be again under weakening pressure, because the zloty might drop after Lech Kaczynski won the Polish presidential vote. Thus we may see the EUR/CZK again above the 29.80 level.

(CSOB - Investment research)