Koruna Depreciates, Local Data Disappoint

EUR/CZK continues to creep higher, even as the koruna outperforms its CE3 peers. The pair last deals +0.034 at 24.225, with bulls setting their sights on the 24.3 area, which capped gains in early August. Bears eye support from round figure/Aug 21 low of 24.000/23.977.

• Czechia's industrial output unexpectedly contracted 2.9% in Y/Y terms in July. Construction output shrank 2.1% Y/Y, with Komercni banka highlighting that "the number of newly issued building permits in the Czech Republic in the first seven months of this year was the lowest since 2015". Trade balance flipped into a deficit of CZK5.9bn versus +CZK2.6bn expected.
• CNB's Jan Prochazka said that the central bank could discuss the possible timing of rate cuts at the September meeting but is unlikely to go ahead with monetary easing as long as the ECB remains in tightening mode.
• Parliament continues to debate the government's fiscal consolidation package in second reading, with opposition parties set to table almost 100 amendments to delay the adoption of austerity measures.