The Czech koruna was almost flat on
Friday. Initially it lost some ground, but the
unit recovered by the end of the session and
closed unchanged. All at all, the koruna
stayed at the tight range of EUR/CZK 31.54
– 31.62. The market ignored extraordinary good government budget data; the budget
ended in CZK 10 bn surplus for September
and in only CZK 40.52 bn deficit year-todate.
The cumulative deficit is only half of
the last year’s deficit in the same period of
the year. Although the Finance Ministry still
expects the budget deficit will climb to CZK
115 bn at the end of the year, as it’s
planned, we see significantly lower deficit for
the whole year. The low deficit is caused
mainly by higher tax revenues.
Today the calendar is empty, thus the
koruna may hover around EUR/CZK 31.55.
The market will wait for Wednesday’s foreign
ČSOB - Investment Research