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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.
CZECHIA
- While ST interest rates in Czech Republic keep reaching new highs as CNB has embarked on a tightening cycle, long-term bond yields keep falling globally amid rising uncertainty over a range of risk factors (Delta variant, falling Chinese liquidity, rising political instability…).
- Czech 2Y10Y yield curve has flattened by 100bps since December 2020 to 32bps today.
- Interestingly, Czech financial stocks have trending higher in the past 6 months and have not been impacted by the sharp fall in LT bond yields.
- The chart below shows that Czech financials have co-moved strongly with ST bond yields in the past few years.
- Hence, higher ST yields should continue to support cyclical stocks such as financials in the near to medium term.
- As a reminder, CNB is expected to raise its policy rate by 25bps to 0.75% tomorrow (August 5).
Source: Bloomberg/MNI
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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