Czech koruna back above 30.00 level In the morning

Czech koruna back above 30.00 level In the morning, it seemed that sideways trading would prevail on the Czech forex market. The koruna opened only a touch weaker at EUR/CZK 29.62 and hovered around that level for the most of the day. The calendar was empty, only deputy finance minister Janota said that the ministry could issue eurobonds for EUR 500 m, if the condition on the markets would be favorable. The government placed EUR 1 bn 15-year issue in recent days. Nevertheless, it had no impact on the market. Thus slightly negative atmosphere prevailed on the market. Cautiousness of the investors towards Central Europe became evident after the dollar jumped up on unexpectedly high inflow of investments into US securities at 15:00. The koruna subsequently lost about 0.5 % as fell to the EUR/CZK 29.8 zone in step with other CE currencies.

Today the calendar is empty again from the FX market point of view. Scheduled bond tender should not have any impact on the koruna. Hence traders will likely inspire abroad. The development in regional markets should be decisive and regional negative atmosphere hardly changes today. Thus the koruna may break through the 30.00 level.

(CSOB - Investment research)