Nor a soft ECB nor outright dollar strength (caused by emerging markets nervousness) was able to break EUR/USD's key support near 1.1550. Continued dollar strength limits the upside room for now.
EUR/GBP's test of the upper band of the 0.87/0.885 consolidation pattern, failed. However, poor Brexit progress and the (internal and external) bickering May's Brexitstrategy undoubtedly will cause, remain a drag for sterling.
Revived dollar strength and a generally improved – but fragile – risk sentiment pushes USD/JPY further north from the 110‐area.
The CNB's rate hike offered little to no support for CZK. Continued weakness compared to the CNB's forecasts suggests more rate hikes will be coming sooner than anticipated earlier.
EUR/HUF trended further north, leaving the 305‐315 trading range. The forint lost ground following Orban's new election victory and during the emerging market turmoil. The NBH changed its forward guidance, the first step towards policy normalisation.
The zloty took a hit as the dollar firmed on the back of many emerging market currencies. Furthermore, the NBP has no intention at all to normalize policy any time soon as it made clear in its last June‐meeting.
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.