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Koruna Treads Water, CNB's Zamrazilova Signals Caution Over Rate Cuts

CZK

EUR/CZK trades at 24.075, little changed on the day. From a technical standpoint, bears see Aug 21 low of 23.977 as their initial target and a break here would expose the 200-DMA at 23.830. On the flip side, bulls eye resistance from the 24.3 area.

  • CNB Deputy Governor Eva Zamrazilova revealed that the planned sales of part of the income on FX reserves will be capped at EUR300mn/month and will depend on market conditions. Other officials had earlier said that the transactions will be conducted in such a way as to avoid any impact on the FX market. Zamrazilova added that the central bank will be cautious about rate cuts.
  • CEZ shares have ticked higher, even as parliament approved in first reading a bill making it easier to revamp its structure. The PX Index operates ~0.6% higher on the day at typing.
  • Ruling coalition leaders agreed last night to set the budget deficit target for next year at CZK252bn. The deal was reported in a sources piece by Seznam Zpravy.

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