Koruna Benefits From USD Dip

Post-data weakness in US dollar has lent some support to the broader EM FX space, with EUR/CZK dipping to a new session low of 24.072. The rate last deals -0.054 at 24.099 and the koruna is among top performers in the EMEA space (lags behind HUF but comfortably outperforms PLN).

• The CNB confirmed that Q2 GDP data were better than implied by staff forecasts. In an official statement, the central bank said that the economy should "return to visible growth in the second half of the year" and could "grow by more than 2% next year despite the government’s fiscal consolidation efforts."
• In his notes from debates with other central bank heads during the Jackson Hole symposium, Governor Ales Michl wrote that inflation remains at unacceptable levels, but the CNB has adopted the right strategy to bring it to the target.