Koruna Little Changed, CNB Comments On Latest GDP Print Eyed

EUR/CZK deals +0.006 at 25.348, holding a very tight range into the end of the week. From a technical perspective, a rally above Feb 15 high of 25.519 would signal potential for a resumption of the uptrend. Bears look for a pullback past the 25.0 figure and towards Jan 2 high of 24.867.

• CZGB yields are broadly lower across the curve, with FRAs sitting close to familiar levels. The PX Index snaps a five-day losing streak and has now added 0.4%, with bulls setting their sights on the psychologically significant 1,500 level. Today's recovery of the index coincides with a rebound in the shares of majority-state owned utility CEZ, with recent days bringing positive news re: legislation on asset splits and the future of windfall tax.
• Preliminary data from the CZSO showed that the economy shrank by 0.2% Y/Y in 4Q23, which was in line with consensus but less severe than expected by the CNB (-0.46% Y/Y in the winter forecast). The central bank will release its comments on the data at 12:00GMT/13:00CET (note that this corrects an error from the previous bullet).
• Czechia's S&P Global Manufacturing PMI recovered to 44.3 in February from 43.0 prior versus expectations of a deterioration to 42.5. While the index remained in contractionary territory, there were signs of optimism among Czech firms. Furthermore, "input costs s rose for the first time in a year," with S&P predicting that the CNB will press ahead with further rate cuts in 1H2024.
• The Finance Ministry will publish monthly budget data at 13:00GMT/14:00CET.