The koruna dropped as the market had been afraid of the delayed dragging
enlargement of the EU, of central bank's position and of cutting the
interest rates. The koruna's rate versus the dollar copied the EUR/USD
development.
The koruna should remain on these weak levels until the next
Thursday, when the Bank Board meeting takes place with monetary policy on
the agenda. Only the result of the meeting will provide an impulse for
further koruna's development. The market expects the rates to be cut by at
least a quarter point. We anticipate the EUR/CZK in the range of 30.800 -
31.000 and the USD/CZK from 31.500 to 31.950. The koruna started at 30.925
per euro and at 31.720 per dollar in the morning.
Stepanka Kuzilkova, Investment Research, CSOB