Czech bonds decoupled from German
Bunds yesterday as they eased slightly.
While bond yields moved up by around 3
bps, money markets rates headed north too
(for instance 3x6 FRA contract closed by 7
bps higher). The fixed income market seem
to be driven by koruna’s weakening as the
FX rate is among factors, which affect CNB’s
monetary decisions
The short end of the Czech yield curve
could start the day with slight gains as the
Czech koruna is expected to come up with
the recent gains of the region. Nevertheless
the moves should not be significant and
especially longer maturities might stay
without major changes at least till the
release of US figures later in the session.
(CSOB - Investment research)