Stable currency, focus on Czech CPI before the tariff decision
The Central European currency is mostly stable on Tuesday, with investors analyzing the Czech inflation data in front of the central bank interest rate decision on Thursday, while the stock market varies.
Czech inflation data did not change the expectations of pauses in the reduction of interest rates at the central bank meeting this week.
“The results of inflation do not change our view that CNB (Czech National Bank) will leave interest rates that have not changed on this Thursday. Inflation continues to increase and driven by high service price growth,” said Unicredit Economist Patrik Rozumbersky.
“High wage growth and high growth in apartment prices are among other inflation risks that increase standards for cutting levels at the remaining CNB meetings until the end of the year.”
Czech monetary policy makers are widely expected to have a stable interest rate on Thursday for the second successive meeting, and the market will look for instructions on whether the central bank easing cycle is in or near the end.
Analysts in the Reuters poll last week saw the scope for other tariffs with the end of this year, even though the market has appreciated its opportunities.
The crown reached the strongest level against Euro towards the end of July, at 24.53, and has been floating near the sign since then. Eurczk traded lower touch at 24,5940 at 0807 GMT.
Another currency in Central Europe remains relatively stable, with Forint Eurhuf Hungary at 399.40 per Euro and Zloty Eurpln Poland at 4,2740, 0.1% higher on that day.
“In the case of EUR/PLN, we hope that the side is the side to continue in the short and medium term below the technical resistance level at 4,2850,” Bank PKO analyst said in a note.
The stock market in the region was mixed, with the main PXA PX index stable and the Warsaw GPW stock exchange lost 0.13%, while the market in Budapest Bux rose 0.4%, supported by Bank OTP OTP.
OTP rose 0.3% after issuing the quarterly results.
“The second quarter event could not shake the ability to generate bank profits, so instead of 313.6 billion forint expected, the consolidated net profit for the quarter came in 330.2 billion forints,” said Broker Equilor.
“This is in accordance with the return of equity of 25.6 percent. It should be remembered that the results of the first quarter were burdened with a full year order from several tax items, which reached 123 billion forint.”
Source: Reuters
