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Koruna Loses Ground, CNB's Zamrazilova Sees No Need For More Rate Hikes


EUR/CZK trades +0.075 at CZK23.551, advancing for the third consecutive day. For bulls, a rally above the 50-DMA at CZK23.833 would open up scope for a stronger recovery. Meanwhile, bears look for a dip through Mar 1 low of CZK23.343, followed by Jul 21, 2008 low of CZK22.877.

  • CZGBs have faltered in early trade, curve has flattened. The PX index sits ~0.6% higher on the day after printing fresh cyclical highs at 1,433.
  • Comments from CNB's Eva Zamrazilova did the rounds over the weekend and this morning. The official reiterated her preference for the exchange-rate channel of monetary policy over interest-rate action and said a larger than expected fall in demand provides a strong argument against further rate hikes.
  • Czech real wages shrank less than forecast in 4Q2022, by 6.7% Y/Y versus 7.8% expected. The decline in real wages for the full 2022 was 7.5%, the steepest fall since the dissolution of Czechoslovakia.

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