The Czech koruna didn’t climbed further on Friday, in contrary it came back above the EUR/CZK 28.60 level. Although other emerging markets prolonged their gains in the morning, the koruna was loosing ground since the beginning of the session. It opened at 28.47 to close at 28.62.
The market was under biggest downward pressure in the afternoon, when also other regional currencies began to weaken and Nomura announced that it won its case vs. the Czech Republic over the IPB bankruptcy. Nomura asks at least CZK 40 bn. However, the case will take another couple of years, therefore it could hardly affect the market in foreseeable future.
The domestic calendar is empty for whole week, therefore the koruna may look for inspiration abroad. Today it may pare some Friday’s losses, because it weakened the most in the region on Friday. It may trade within the range of 28.50/70.
(CSOB - Investment research)