CZK: Koruna Tad Weaker But EUR/CZK Refuses To Print Higher Highs

EUR/CZK oscillates near its highest levels in two months, last trading +0.011 at 25.353. The recent stabilisation of price action keeps the RSI just below overbought territory. A break above Aug 1 high of 25.535 would confirm that bulls remain in control, while bears look for sales towards the 50-DMA, which intersects at 25.165.

• Czechia's industrial output shrank by 1.5% Y/Y in August in non-seasonally adjusted terms, beating Bloomberg consensus forecast of -2.2%. After adjusting for the number of working days, industrial production was 1.5% higher than a year before. Komercni banka pointed to the positive impact of car production amid receding problems with the supply of vehicle parts. However, a further recovery in industrial performance in Q3 seems unlikely in their view, considering the extensive flood damage in September and the continued slowdown in Germany. Elsewhere, trade balance unexpectedly flipped into a surplus, while construction output fell (albeit in the wake of a strong July).
• President Petr Pavel will today meet with two ministerial candidates, who are expected to take office tomorrow. Lukas Vlcek will succeed Jozef Sikela as Industry and Trade Minister, while Petr Kulhanek will succeed Ivan Bartos as Regional Development Minister.
• CZGB yields are higher across the curve, with 5s underperforming at typing. The PX Index sits 0.1% below neutral levels.