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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CZK
EUR/CZK last seen +0.004 at 24.420, with familiar technical levels still in play. A clearance of the 61.8% retracement of the Oct 26 - Nov 29 sell-off/Dec 12 high at 24.539/24.549 would open up Oct 26, 2023/Jul 7, 2022 highs of 24.747/24.797. Bears look for a pullback towards Nov 29 low of 24.203.
- Local headline flow has been rather thin, with participants already focusing on next week's CNB rate decision seen as a coin toss between a hold and a cut. As things stand, 5 out of 7 economists polled by Bloomberg expect the Czech central bank to reduce the two-week repo rate by 25bp, while Czech 1x4 FRAs trade at a ~20bp discount to 3-Month PRIBOR.
- Heading into the CNB monetary policy meeting, EUR/CZK 1-week implied volatility has soared to the highest levels in three months, which has been at odds with the recent downswing in EUR/USD implied volatility of corresponding tenure.
- CZGB yields are generally a tad lower across the curve. The PX Index has added 0.5% this morning.
Fig. 1: EUR/CZK vs. EUR/USD vs. EUR/PLN 1-Week Implied Volatilities
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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