The Czech koruna held in the tight range of EUR/CZK 28.70/76 yesterday morning

However, benign U.S. inflation stormed the market. Improved atmosphere toward emerging markets after a deep drop of the U.S. dollar cleared the way for a strong koruna. The Czech currency easily broke through the barrier at 28.62/65 and halted at 28.46. No domestic event affected the market. The koruna is back in the former band of 28.25/62. Under such positive atmosphere might be difficult for it to depreciate back out of that range. However, the markets may stabilize worldwide today, therefore the koruna may trade sideways within the weaker half of the current trading band. Today’s retail sales may not affect the market.

(CSOB - Investment research)