CNB’s governor Singer is not afraid koruna’s strengthening after exiting from the current regime
No more foreign currency issuance from the Polish MinFin this year
Yesterday, CNB´s governor Singer again confirmed our view that koruna’s strengthening after exiting the current monetary regime (with a floor for the EUR/CZK rate at the 27.0 level) looks like a realistic scenario. Singer pointed out that as soon as the exchange-rate target was removed, the Bank Board would not care if the koruna firmed. The recent Singer’s comment just fits into our view that the current regime of interventions against the koruna may persist until the middle of 2015. Then at the end of the existing exchange rate regime, speculation on an abrupt appreciation of the Czech currency will hardly be avoided. The CNB may only succeed smoothly switching to the ‘old’ regime of floating exchange rate by means of huge interventions – so buying euros to its forex reserves.
Read the full report: FX Daily
KBC