The Czech government is on a verge of a diplomatic war with Austria over the nuclear plant in Temelin. Austrians abhor everything that deals with the nuclear power (except the International Agency for Nuclear Energy that is hosted by Vienna…) and Czechs pride themselves on finishing (after 14 years…) the nuclear plant. Thus, border crosses are blocked, ambassadors summoned and deadlines issued. Meanwhile, Temelín slowly continues its test runs.
The government also formally postponed telecommunication privatization yesterday: Ceske Radiokomunikace will be sold by the end of December and a decision on the form of privatization of Cesky Telecom will be made by the end of November. It seems that the Cabinet is not up to the privatization.
The Czech koruna lost marginally vis-a-vis the euro from 35.33 to 35.41 CZK/EUR. The exchange rate vis-a-vis the dollar was rather volatile, first the koruna going up from 40.80 to 40.40 CZK/USD and then falling back to 40.50 CZK/USD.
Bond prices fell massively by 25-45 bps.