The Czech koruna finally released from a
downward pressure yesterday. The unit lost
some ground initially but it strengthened
almost whole day and closed some 8 hellers
stronger at EURCZK 31.79. There was no
particular reason for the move, we attributed
it to a overall positive sentiment on Central
Europe. The FX market ignored yesterday
releases (issuance calendar and central government budget).
Today, the positive sentiment may continue
but a nervousness ahead of tomorrow’s
foreign trade data might take part as well.
The foreign trade should post a deficit of
CZK 7.5 bn in July after slight surplus in
June. All at all, the koruna may somewhat strengthen.
ČSOB - Investment Research