Czech bond market was pretty calm yesterday despite a storm on core markets. Of course, Czech yields went up, but no sell-off occurred. Investors’ opinions didn’t changed, no one wants to sell bonds, as any rate hike is in pipeline for foreseeable future. Moreover, it’s difficult to exploit temporal drop of Czech bonds, as the market is thin. If you sell part of your portfolio, you will have trouble to buy it back. Today the calendar is empty, but the market may await tomorrow’s meeting of the central bank. We repeat again, no action is expected. Thus price action on core market might be decisive.
(CSOB - Investment research)