The Czech koruna shot up on Friday. The
market sentiment was positive for the koruna
from the real beginning of the session, but
the unit mostly rose just few hours ahead of
the close of the session. We should blamed
primary lower liquidity, as many traders were
on vacation or weekend. Moreover, some
traders bet on aggressive rate hikes in
months to come. They received a support
from higher-than-.expected PPI figures
(more in bond section). Finally, some
customers might have waited with their eurosell
others for better exchange rate. They
likely had to sell their euros as the strategy
turned out to be wrong. All in all, the koruna
strengthened from 31.40 to 31.24 against the euro.
Today, the koruna might continue to slightly
rise, as PM candidate Stanislav Gross won a
support of his Social Democrats on Sunday
for maintaining the ruling center-left coalition.
ČSOB - Investment Research