KBC Market Research Desk
KBC Bank
Currencies
EUR/USD
EUR/USD set a cycle low in the1.11 area after SNB removed its CHF cap and as the ECB announced a full‐option QE programme. Later, the pair found a ST equilibrium in the 1.13/14 area.
EUR/GBP
EUR/GBP extends its downtrend, in the first place due to euroweakness. Sentiment on sterling remains constructive, as the BoE sounds optimistic on growth.
USD/JPY
USD/JPY maintains the established 115.57/121.85 trading range. Initially USD strength prevailed. However, mid‐ February, the yen became better bid on rumours that the BOJ sees further easing as potentially counterproductive.
EUR/CZK
The Czech koruna weakened in January on speculation that low inflation could inspire the CNB to raise the EUR/CZK floor. However this speculation proved premature. EUR/CZK returned south of 28.00.
EUR/HUF
The forint came temporary under pressure early January (CHF decoupling and global volatility), but the loss was soon reversed as CEE currencies rose against a broadly weaker euro (QE).
EUR/CHF
The Swiss franc settled in the 1.00/1.05 area after the SNB gave up the EUR/CHF cap to prevent further CHF strength. It is not sure yet whether this equilibrium is ‘sustainable’. There are still rumours of SNB interventions.
This non-exhaustive information is based on short-term forecasts for expected developments on the financial markets. KBC Bank cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct or consequential loss arising from any use of this document or its content. The document is not intended as personalized investment advice and does not constitute a recommendation to buy, sell or hold investments described herein. Although information has been obtained from and is based upon sources KBC believes to be reliable, KBC does not guarantee the accuracy of this information, which may be incomplete or condensed. All opinions and estimates constitute a KBC judgment as of the data of the report and are subject to change without notice.
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