Czech Koruna rallied late yesterday with EUR/CZK moving below 23.60 after the Czech National Bank (CNB) hinted at a rate hike. Economists at Commerzbank expect CZK to remain supported for now.

Hawkish CNB message

“CNB Governor Alles Michl made hawkish remarks following the rate meeting, saying that the market’s assessment – that CNB’s rate hikes are over – could prove wrong.”

“Whether Michl would really pull the trigger easily or not remains to be seen, but for now his verbal intervention will support the Czech Koruna.”