The EUR/CZK opened at 30.790 yesterday and remained in the range of 30.790 -
30.840 during the morning. However, downgraded rating of the Czech Republic
by rating agency Standard&Poor's sent the koruna to the level of 31.010. The
EUR/CZK closed at 30.910. The koruna slid also vs. the dollar from the
opening level of 30.850 to 30.920 at the end of trading.
The EUR/CZK could
be under the influence of downgraded rating again and should not strengthen
significantly. We expect the EUR/CZK to be curbed between 30.750 - 31.050
and the USD/CZK should move between 30.750 - 31.150 today. The EUR/CZK
opened at 30.925 and the USD/CZK at 31.020 today. Standard&Poor's rating
agency yesterday lowered its long-term local currency ratings on the Czech
Republic to A+ from AA minus, and its short-term local currency ratings to A
-1 from A -1 plus. Both ratings were downgraded due to the coalition
government's very narrow majority in Parliament and its pro-welfare policy,
leading to excessive state budget deficits.
open high low close today(6.11)
EUR/CZK 30.790 31.002 30.790 30.910 30.925
USD/CZK 30.850 30.950 30.720 30.920 31.020
Stepanka Kuzilkova, Investment Research, CSOB