Wed, Jun 3 2009, 04:49 GMT
by KBC Market Research Desk
Czech industry continued to plummet in April
NBH stays on hold
Poland remains the only country of the region showing positive growth
CNB and NBP have not left easing mode
While markets of risky assets are still being fuelled by the hypothesis of the spring signs of recovery, the central banks of the Czech Republic and Poland are concerned with something else. They seem to be primarily setting the stage for being able to cut official interest rates again, thus relieving the economy.
Unlike the United States, and particularly certain Asian countries, where signs of a stabilisation of the economic downturn are already evident, nothing like that is true for the Czech Republic and Poland at the moment. This was confirmed by both the flash forecast of April’s industrial output in the Czech Republic and Poland’s GDP forecast for the first quarter of this year. Both values are in line with the moderate statements by Members of the CNB Board and the NBP, who particularly highlight the poor performance of their economies.
Thus, given the fact that, with the current levels of the koruna and the zloty, neither the CNB nor the NBP need to be concerned about a weak local currency and the possible upside inflationary consequences, additional cuts in the official interest rates in the Czech Republic and Poland appear to be highly probable. And when are those rates going to be cut? Both central banks are likely to cut their rates by another 25 basis points as early as in June. For the CNB, this was indicated by the series of dovish comments from Members of the CNB Board. For the NBP, this will depend on when the bank discusses the new inflation forecast, which will include a new, probably more pessimistic, outlook for the Polish economy.
Published on Wed, Jun 3 2009, 04:57 GMT
KBC Bank
| Havenlaan 12, 1080 Brussels
http://www.kbc.be/dealingroom | piet.lammens@kbc.be
Forex Trading Strategies - Dollar bears take a breather as Asia focuses on bank capital levels by Saxo Bank
Tue, Nov 24 2009, 07:27 GMT
Weekly Update - The euro rose buoyed by positive economic data from Europe by Union Bank of California
Tue, Nov 24 2009, 06:16 GMT
Technical Market Commentary - Technical Market Commentary by India Forex Advisors
Tue, Nov 24 2009, 05:58 GMT
Fundamental News Summary - Asian Session News Summary by ecPulse.com
Tue, Nov 24 2009, 05:57 GMT
Forex Trading Strategies - Market starts the week with another attempt at reinvigorating the USD carry trade by Saxo Bank
Tue, Nov 24 2009, 05:57 GMT
UK Total Business Investment falls 3% QoQ and 21.7% YoY in 3Q
FXstreet.com | Tue, Nov 24 2009, 09:34 GMT
DATA SNAP: UK Oct Mortgage Lending Unchanged From Sep - BBA
Dow Jones | Tue, Nov 24 2009, 09:34 GMT
UK Oct BBA Mortgage Approvals up to 42.2K from 42.1K
FXstreet.com | Tue, Nov 24 2009, 09:33 GMT
DATA SNAP: German Ifo Nov Business Confidence Beats Forecasts
Dow Jones | Tue, Nov 24 2009, 09:13 GMT
German Nov IFO Business Climate rises to 93.3 from 91.3
FXstreet.com | Tue, Nov 24 2009, 09:00 GMT
GET CASH BACK FOR YOUR TRADES! Learn more about the Pip Rebate Program