The Czech koruna rebounded yesterday. It again broke through the EUR/CZK 30.00 level and closed mildly below it after four days being locked in tight range of 30.05-15. Despite observable progress in political dispute within ruling coalition the market finally came into a conclusion that break down of the government wasn’t likely. The koruna opened at 30.08 as usual in these days but it was firming until the noon. In the afternoon it hovered on the strong side of the 30.00 level. The market was encourage also by previous comments of newly named vice-governor Singer who saw room for strengthening of the koruna in the long-run.
Today no event scheduled in the calendar. Thus all eyes may focus on political dispute within coalition. Although we don’t expect further escalation of the conflict, that’s necessary to watch it closely. Thus we see only tine room for another cautious koruna’s gains.
ČSOB - Investment Research