25 Mar 2015
EUR/CZK seen grinding lower – JP Morgan
FXStreet (Edinburgh) - Analysts at JP Morgan keeps positioned for a decline in EUR/CZK.
Key Quotes
“We continue to position for a gradual grind towards the EUR/CZK floor over the coming months”.
“We think there is still room for short CZK positions to be squeezed given the diminished risks for a re-peg higher in the floor”.
“Balance of payments dynamics are also moderately positive for CZK”.
“We also think the CNB have the ability and willingness to defend the floor should the market test it in the coming months: CPI is still low (0.1% y/y), BoP fundamentals are weaker relative to CHF or DKK and the CNB’s balance sheet is smaller (23% of GDP)”.
Key Quotes
“We continue to position for a gradual grind towards the EUR/CZK floor over the coming months”.
“We think there is still room for short CZK positions to be squeezed given the diminished risks for a re-peg higher in the floor”.
“Balance of payments dynamics are also moderately positive for CZK”.
“We also think the CNB have the ability and willingness to defend the floor should the market test it in the coming months: CPI is still low (0.1% y/y), BoP fundamentals are weaker relative to CHF or DKK and the CNB’s balance sheet is smaller (23% of GDP)”.