The February C/A was above the market expectation (EUR 77m). The current account surplus exceeded EUR 484m due to the payment of funds to the CSOB from the Slovak Republic as a result of arbitration case. The C/A surged up into the black for only the second time since the CNB started publishing monthly balance of payments data in 2003. But the C/A will return into the red during next months especially due to the high deficit of income balance. In the afternoon the koruna gave up part of its previous gains and closed at nearly 29.90 per euro. Today, the producer prices will be published. A disinflation trend in industries was confirmed as the year-on-year PPI dropped to 6.4% from 7.1% in February. However, the market ignores those prices as usually. The advance in talks about new quasi-coalition government will probably not influence the market too. Hence, the koruna will eye the US dollar swings and other currencies in the region. We expect only moderate fluctuation within the range of 29.75-30.00 per euro.
(CSOB - Investment research)