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Implied Volatility on The Bond Market Remains Low Despite Surging Poland and Hungary LT Yields

CZECHIA
  • While LT interest rates have been surging in Poland and Hungary, implied volatility in the Czech bond market has remained low with the 10Y yield remaining flat slightly below 1.80% in the past two weeks.
  • We saw that Poland 10Y yield nearly tested its 2% key resistance yesterday, and Hungary 10Y yield broke above its 3% resistance last week (next key level to watch on the topside stands at 3.22%).
  • Key resistance on Czech 10Y yield remains at 2%; on the downside, first support stands at 1.74% (100DMA), followed by 1.72% (50DMA).
  • Next key data to watch will be August inflation coming out on Sep 10 and expected to accelerate to 3.6% YoY according to sell side estimates.

Source: Bloomberg/MNI

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