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Koruna Awaits CNB Monetary Policy Decision


EUR/CZK last changes hands +0.012 at CZK23.792 with all eyes on the CNB Bank Board's monetary policy review. From a technical standpoint, bulls look for a break above the 50-DMA, which kicks in at CZK24.110. On the downside, the focus is on Jan 30, 2023/Oct 30, 2008 lows of CZK23.716/23.700.

  • The clock is ticking on the CNB to announce its monetary policy decision and unveil a new set of economic forecasts. Governor Ales Michl will later hold a media briefing at 14:45GMT/15:45CET, with the presentation of forecasts for market analysts coming up tomorrow at 10:00GMT/11:00CET.
  • EUR/CZK overnight implied volatility holds at relatively elevated levels after lodging new six-month yesterday. 1-week tenor refreshed its four-month highs this morning, while there has been little movement in implied volatilities further out the curve.
  • The CNB is widely expected to leave the main monetary policy parameters unchanged. Some are on the lookout for any hints re: potential shift in the central bank's commitment to protecting the Koruna. The CNB has not had to intervene in FX markets recently amid The CZK's appreciation to its best levels since 2008.
  • The PX index advanced to new cyclical highs just shy of the 1,350 mark, extending its stellar performance this year, with the RSI moving further into overbought territory.

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