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Support For CZK Could Rise Ahead of CNB Meeting

CZECHIA
  • Economists expect the CNB to raise its benchmark rate by 75bps to 3.5% at its next meeting on December 22.
  • Governor Rusnok recently mentioned that the expects debate on a bigger than 50bps rate hike next week.
  • Hence, the ‘aggressive’ hike could continue to support CZK against the Euro (with the ECB remaining ‘silent’ on the policy outlook).
  • ST support to watch on EURCZK stands at 25.20; a break below that level would open the door for a move down to 25.
  • Key support stands at 24.77, which was the low reached in mid-February 2020.
  • On the topside, resistance to watch stands at 25.57 (200DMA).

Source: Bloomberg/MNI

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