The Czech koruna was attacking lower limit of current trading band (EUR/CZK 29.83-30.05) yesterday. It opened visibly stronger at 29.725, but quickly changed a direction and was slowly returning back into the band to close around 29.85. There was no particular event behind the price action. Overall positive atmosphere in the region pushes the koruna higher. The recent drop of yields world-wide helps, too. Finally, the weak euro could have some positive influence. Today, the koruna might remain strong. Though yesterday’s attempt to break through 29.83 was not fully successful, positive atmosphere on the market didn’t disappeared. Nevertheless, we assess current gains as temporal, because approaching holiday period might not be positive for the CE markets.
(CSOB - Investment research)