The Czech koruna was flat on Monday, it
did not resume in Monday’s strengthening.
The unit stayed in the tight range of
EUR/CZK 31.38 – 31.45 to close unchanged at 31.40. There wasn’t any relevant event
for the market yesterday. Vice-governor
Niedermayer again repeated that there is no
need for imminent rate hike (how many other
affirmations should we receive from the
central bank officials ahead of next week’s
CNB Board meeting?). Niedermayer added
that he was skeptical the Czech republic
would adopt the euro in 2010 because of
lack of any real government effort. He only
explicitly said what everybody knew.
However, the government still have a lot of
time and it could change its attitude in time.
Today the only event is a tender of 5-year
benchmark. It supposed to be largely
oversubscribed, but it wouldn’t affect the
forex market. We expect calm trading and
no significant price action by next
ČSOB - Investment Research