The Czech koruna hovered in rather tight
range of EUR/CZK 30.58-30.67 yesterday.
The market was quiet and ignored all
incentives. Nevertheless, all central banker
words and stagnation of producer prices in
November were in favour of our base
scenario of stable rates in at least 6 months.
Both vice-governor Niedermayer and CNB
board member Racocha said that the strong koruna made any rate hike difficult. They
added that even the economy didn’t need
monetary tightening. The central bank may
seek to stem the koruna's 5.8 percent gain
against the euro this year by delaying
interest rate increases rather than selling the
currency, said Niedermayer. However, he
warned the market that there was no reason
for strengthening of the koruna after the
government decided to sell Cesky Telecom
to strategic partner. Moreover he regarded
dividend outflow as serious and rising
problem of Czech current account.
Today we do not see any reason why the
quiet atmosphere on the market should
change. The Parliament will finally agree
state budget for the next year with deficit
CZK 83.6 bn. Nevertheless, it should not
have any impact on the markets.
ČSOB - Investiční výzkum