The Czech money market interest rates
and yields on the short end of the curve
went up quite dramatically (7 bps). That was
mainly due to additional hawkish comments
made by the CNB’s vice governor Singer.
Singer is nevertheless well known activist
and was always willing to hike or cut rates
earlier than other members of the board.
That is why we believe, finally the opinion of
the central bank’s governor Tuma should be
decisive. Hence we still bet on the stability of
the rates after the CNB’s meeting next week.
Today we do not expect any significant
impetus for trading from domestic scene.
The yields and interest rates at the short end
of the curve do not have much space for
rising further. On the other hand the yields
of the longer maturities could increase a bit
as tracking the development of German
bund.
(CSOB - Investment research)