The Czech koruna shot up on Wednesday,
while it traded only a bit stronger on
Tuesday. The unit began the last two days
at the EUR/CZK 31.40 zone and it gained
some 5 hellers over Tuesday’s quiet
session. On Wednesday, domestic market
was closed due to national holiday.
However, foreign banks step in this thin
market and pushed the koruna in two steps
to low twenties. We can not be sure what
was the real reason for the trading action,
but every one blames privatization of Czech
Telecom. That’s not perfect explanation, but we do not have any better.
The information, that the government
considers to sell of its majority in Cesky
Telecom on Prague stock exchange, is
public for many weeks. Accordingly it is
known that the PM Gross favors this
approach. Hence that’s not clear, why the
traders pushed the koruna particularly
yesterday. On the other hand, the market
was bored by low volatility of recent weeks.
Thus yesterday’s thin market was a perfect
option to push the currency out of recent
Today retail sales hardly move the market.
Moreover, strengthening of the koruna may
be stopped by technical barriers at
EUR/CZK 31.20 and 31.16. Thus we favor
some consolidation of the market.
ČSOB - Investiční výzkum