The koruna continued strengthening on Friday. The EUR/CZK touched the level
at 29.350 during morning trading and set a new record at 29.180 in the
afternoon. The koruna closed at the level of 29.200 against the euro. The
koruna gained also against the dollar and reached a new maximum at 29.270,
however, it lost slightly in the afternoon and closed at 29.560. The trading
was influenced by euro-dollar markets as the three major world central banks
intervened against the firming yen.
Czech market will watch closely CNB
reaction on the firming koruna this week. CNB is supposed to intervene
against the koruna or cut interest rates. If not, the koruna may keep
strengthening. The regular CNB meeting is planned for Thursday, however, the
decision on rates cut or intervention might come from an extraordinary
meeting. We expect the EUR/CZK to move in the range of 29.050 - 29.350. The
USD/CZK should move between 29.400 - 29.900.
open high low close today (1.7.)
EUR/CZK 29.395 29.480 29.180 29.200 29.230
USD/CZK 29.750 29.770 29.270 29.560 29.400
Stepanka Kuzilkova, Investment Research, CSOB