The key incentive came from the core markets, as they rose to a new highs. The price action on the thin Czech market was significantly lower. The yields erased some 3 bps, which is only a third of what the US yields did. Investors ignored the low May budget deficit. Even fresh issuance calendar didn’t spur the market. The Finance ministry plan to place bonds worth CZK 33 bn in Q3, well in-line with expectations. The ministry schedules 4 auctions of new 3, 5, and 15 benchmarks. It will also reopen 10-year benchmark. Today traders may look at the core markets again, as the domestic calendar is empty. However, the market is rather distant to move much higher on current strong rally on US and EMU debt markets.
(CSOB - Investment research)