The Czech koruna stayed locked in a tight
range above 28.30 EUR/CZK during most of
the Friday’s session. It more or less ignored
the gains of the zloty and the forint in the
morning and remained under negative
impact of falling domestic money market
rates.
The result of the weekend’s municipal
elections and the first round of the Senate
elections confirmed expected victory of the
rightist parties and independent candidates.
ODS’s candidates advanced to the second
round in 26 of the 27 Senate districts and
the party won 36% of the votes in the
municipal elections, second only to
independent candidates. In Prague, České
Budějovice, Děčín, Teplice, Hradec Králové
and Kladno, ODS won a simple majority and
does not need a coalition partner.
Nevertheless the impact on the market
should be limited till the end of the second
round of the Senate elections next week. Till
that time, investors might shift their attention
towards the series of Central banks
meetings including CNB´s rate decision on
Thursday.
(CSOB - Investment research)