The Czech koruna has not been this strong against the euro for 15 years
On Wednesday, 15 February, the Czech koruna had a market exchange value of 23.64 koruna per euro. This is the highest value recorded since July 2008, when the exchange rate stood at 22.97 EUR/CZK. It is still 70 cents short of breaking the all-time record. This increase has been going on for several months now. Against the dollar, on the other hand, the Czech koruna weakened, registering an exchange rate of 22.14 USD/CZK.
According to the Czech Chamber of Commerce, this strengthening of the currency is a passing effect, as the exchange rate is expected to be around 25 EUR/CZK. This is good for the economy and inflation, but export companies are beginning to fear the effects of excessive strengthening.
This improvement in the koruna is also due to the investors’ suspect that ‘the Czech National Bank may relaunch foreign exchange interventions if there are fears of a further weakening of the koruna. It would therefore be appropriate for this condition to be lifted before central bankers start cutting interest rates later this year,” say Next Finance analysts Markéta Šichtařová and Jiří Cihlář.
Below are the one-hour charts on the Forex market for EUR/CZK (1st chart) and USD/CZK (2nd chart):
Sources: https://www.camic.cz/ ; https://www.fxstreet.cz/
Sources of images: https://storyset.com/
