The Czech currency moved against the euro in a narrow band of 31.640 -
31.730 yesterday. The EUR/CZK was influenced neither by the result of Bank
Board meeting, nor by the revised outlook of the Czech economy published by
central bank. The EUR/CZK closed at 31.675. Vis-a-vis the dollar, the koruna
slightly firmed from the initial level of 28.770 to 28.760 at the end of the
day due to further dollar weakening vs. the euro on the world markets. No
important data are released today. Market sentiment should be similar to
previous days. We expected the EUR/CZK to move in the range of 31-600 -
31.800 as it opened at 31.690 today. The koruna should stay between 28.500 -
28.900 vs. the dollar. The USD/CZK opened at 28.770.
The Bank Board of CNB left its key interest rate unchanged yesterday at the
current level of 2.50%. CNB raised its inflation forecasts due to expected
tax hikes before the EU entry. The bank said it saw y/y inflation at 2.9 -
4.3.% in April and 3.9 - 5.3% in October 2004. Central bank also narrowed
its GDP growth forecast for 2003 to 2.3 - 2.9% from previous forecast of 2.2
- 3.5% in January.
open high low close today (25.4.)
EUR/CZK 31.705 31.730 31.640 31.675 31.690
USD/CZK 28.770 28.850 28.680 28.760 28.770
Martin Kocura, Investment Research, CSOB