The Czech koruna was boosted by the improvement in regional sentiment at the beginning of the week and broke through the key technical support of euro at 28.36 EUR/CZK. Regional strengthening was driven by the falling dollar and gains of the Polish zloty. Finally, the koruna was hovering around 28.30 EUR/CZK at the end of the session.
There are no domestic market movers expected in the upcoming days. Due to Polish Holidays and Hungarian post-election temporization there is no significant impetus coming form the region as well. On the other hand the recent falls of the dollar could still provide some support to the koruna today. Nevertheless we do not believe in significant gains as upcoming ECB meeting on Thursday could further boost the yields in the core markets. We see the next support for the EUR/HUF pair at the 28.26 level.
(CSOB - Investment research)