The Czech currency did not get rid off the
bad mood it showed at the end of last week.
Also other regional currencies went through
negative correction and hence further
brought down the koruna. In the morning the
EUR/CZK pair slipped above 28.30 and
moved sideways during the rest of the
session.
Concerning politics, ODS yesterday rejected
the idea of a grand coalition and presented a
plan to Klaus for bringing about early
elections. However, without an agreement
with either ČSSD or the Communists, ODS
cannot push the plan through. Communist
Vice Chair Jiří Dolejš said that early
elections are more and more likely but that
ČSSD’s voters cannot have the feeling that
KSČM let them down by siding with ODS on
the issue.
Today, the Czech currency should stay
under negative pressure partly due to the
nervous atmosphere ahead of key US
figures and partly due to technical factors.
Domestic politics should not attract too much
attention till the upcoming regional elections.
(CSOB - Investment research)