The Slovak koruna ended slightly stronger despite worse than expected foreign trade data. The Slovak foreign trade balance ballooned to SKK 7 bn in July due to higher imports. Export is still strong but high energy prices are probably one of the reasons for rising deficits. Anyway, we expect significant positive impact of new export capacities in the last quarter this year.
The local currency moved to EURSKK 37.650 but retreated back later. And additionally it even appreciated slightly till the end of the session. Today, CPI data are on the agenda. The figure came in line with market expectations at 5.1% y/y. This could fuel rate hike expectations and support local currency. However, we do not expect strong rally today and regional impetus should also be key for the exchange rate.
(CSOB - Investment research)