The koruna continues to strengthen, the euro is already below 23.50

The Czech currency has been doing well for several months. About a month ago, it crossed the threshold of CZK 23.80 per euro, and now it has even broken through CZK 23.50 per euro. At around 2:30 p.m. on Tuesday, the exchange rate was CZK 23.49/EUR, data from the Patria server showed.

“The crown is going today. After breaking the level of 23.60 per euro, it is now also breaking the level of 23.50 per euro, for the first time since August 1, 2008. In the entire trading history of the koruna-euro pair, since 1999, it has so far broken the 23.50 level in only 14 days , mostly in the summer of 2008,” Kovanda said on his Twitter.

The koruna reached its historical maximum in mid-July 2008, when the exchange rate against the single European currency was below the threshold of CZK 23. At that time, the Czech National Bank (ČNB) verbally intervened in the market to weaken the exchange rate.

According to the chief economist of the Czech Banking Association, Jakub Seidler, he continues to insist that several factors influence the strong koruna. He listed them at the end of January:

“The current strengthening of the koruna is due to a combination of factors, from more positive global sentiment to the interest rate differential, past interventions by the CNB or a certain option of the CNB to re-enter the market in the event of a significant weakening of the koruna. This causes a higher attractiveness of the koruna in the eyes of foreign investors and the continued strengthening of the koruna despite less positive fundamental factors and a significant balance of payments deficit,” commented Seidler.