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Euro/Czech koruna seen vulnerable if CNB turns more dovish

ING says EUR/CZK has rebounded back above 24.250, but a more dovish CNB decision could lift the pair further.

Reported · Written up by our desk · Major Pairs

ING’s Frantisek Taborsky said the Czech National Bank’s blackout period has begun and that Deputy Governor Zamrazilova appears to prefer keeping rates unchanged at next week’s meeting. The note highlights that, even after a rates sell-off, the interest rate differential has narrowed.

As a result, EUR/CZK has moved back above 24.250, which ING’s models describe as near fair value. The firm cautioned, however, that a more dovish outcome from the CNB could push EUR/CZK higher.

FXStreet also noted that ING sees limited scope for surprises today, although the CNB could still communicate. The outlook is being watched by traders ahead of broader data catalysts referenced in the market commentary.

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