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CZK: Koruna Ticks Lower, CNB's Zamrazilova Sees Room For Two 25bp Cuts This Year

CZK
EM BulletCzech RepublicBulletEmerging Market NewsCentral and Eastern EuropeCzechia

EUR/CZK last deals +0.014 at 25.022 after returning above the 25.0 mark yesterday. Bulls look for further gains beyond the 50-DMA, which kicks in at 25.100, while bears keep an eye on recent cyclical lows of 24.896.

  • CNB Deputy Governor Zamrazilova said that she sees room for "perhaps two more 25bp rate cuts this year" and that the neutral rate is "somewhere just above 3%." Reaching this level will prompt the central bank to consider whether to cut further, stay on hold, or hike rates. Separately, Bank Board's Jakub Seidler reiterated that the CNB will approach further monetary easing "very cautiously" and cannot rule out leaving monetary policy slightly restrictive for longer than implied by the baseline forecast scenario.
  • The contraction in Czechia's industrial output in January was smaller than expected. Komercni banka commented that "industrial production is likely to remain relatively subdued for most of this year" and may be negatively affected by trade wars and ongoing uncertainty.
  • CZGB curve runs a tad steeper; the PX Index sits 0.5% higher on the session.
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EUR/CZK last deals +0.014 at 25.022 after returning above the 25.0 mark yesterday. Bulls look for further gains beyond the 50-DMA, which kicks in at 25.100, while bears keep an eye on recent cyclical lows of 24.896.

  • CNB Deputy Governor Zamrazilova said that she sees room for "perhaps two more 25bp rate cuts this year" and that the neutral rate is "somewhere just above 3%." Reaching this level will prompt the central bank to consider whether to cut further, stay on hold, or hike rates. Separately, Bank Board's Jakub Seidler reiterated that the CNB will approach further monetary easing "very cautiously" and cannot rule out leaving monetary policy slightly restrictive for longer than implied by the baseline forecast scenario.
  • The contraction in Czechia's industrial output in January was smaller than expected. Komercni banka commented that "industrial production is likely to remain relatively subdued for most of this year" and may be negatively affected by trade wars and ongoing uncertainty.
  • CZGB curve runs a tad steeper; the PX Index sits 0.5% higher on the session.