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EURCZK Inches Further Away From 25.00

CZK
The Czech koruna is outperforming its CE3 peers at the margins, despite EURCZK still operating within close proximity to yesterday’s multi-year highs. EURCZK is slightly in the red at typing (compared to +0.15% and +0.18% for EURHUF and EURPLN, respectively), below the 25.00 handle. PLNCZK fell just shy of 5.8000 yesterday, reaching its highest level in 2 years. CZKHUF price action has been contained within its recent extremes.
  • For EURCZK, the 25.00 threshold - while pierced yesterday - still marks a significant line in the sand and has been a point of focus across a number of sell-side desks. The handle is immediately followed by the 38.2% retracement of the 2020 - 2023 bear leg at 25.043. Conversely, bears initially look for a pullback below 24.621, which capped gains on Jan 2.
  • Broader CZK weakness over the past week can likely be attributed to the perceived increase in probability of an acceleration in easing by the CNB this week. Our full preview of that decision can be found here.

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