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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CZECHIA
- Czech central bank deputy governor Marek Mora mentioned in a podcast interview today that there are still lots of uncertainties over the economic recovery and that the risk of rising inflationary pressures is not negligible.
- The CNB must be 'vigilant', but Mora confirms that the inflation risk is still manageable.
- Core and headline CPI were still sitting within the 1%/3% CNB tolerance band in March at 2.6% and 2.3%, respectively, but could increase sharply in April and May due to the surge in fuel prices.
- Czech policymakers hinted the market on different occasions that CNB will be the first central bank to start raising rates in 2021 in Western/Central/Eastern Europe and therefore traders have been chasing the CZK momentum amid the little divergence in monetary policy.
- Even though the number of hikes have been reviewed to the downside following the difficult first quarter due to the worsening Covid situation, participants still expect one to two rate hikes in H2 2021 (down from three hikes based on the Winter CNB projections).
- The Czech 10y yield has been consolidating lower in the second half of April after failing to break through its key resistance at 2% last month, and recently broke below its 50D SMA. Next support to watch on the downside stands at 1.70%, which represents the 38.2% Fibo retracement of the 1.24% - 1.98% range (2021 high low).
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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