Central European Daily

The Central European currencies eventually closed only little changed on Friday despite the fact that the forint and the zloty were trading about 0.4 % weaker against the euro in early afternoon vis-a-vis Thursday’s close. In the case of the forint, low headline inflation in March could have played a role; let us, however, recall that while the headline figure dropped to 0.1 % Y/Y, core inflation reached 2.7 % Y/Y. Still, the reading was below expectations and the central bank is therefore likely to cut rates to a new all time low of 2.5 % at its next meeting in two weeks.