KBC Market Research Desk
KBC Bank
Currencies
EUR/USD started a gradual downtrend since the ECB ‘announced’ additional easing in May. At the same time, the Fed keeps a soft tone, preventing a dollar rally.
The EUR/GBP downtrend continues. Decent UK data keep the debate on a first BoE rate hike alive. Disappointing EMU data and a very accommodative ECB policy weigh on the euro.
USD/JPY is drifting south in the 100.75/102.80 range. The dollar is in no good shape due to soft Fed talk. The yen is fairly strong even as sentiment on risk remained constructive.
Czech koruna is locked in an extremely tight sideways range as the CNB wants to keep the exchange rate close to the 27.00 level, at least until early next year.
Forint is losing gradually ground as the NMB continues its tactics of minimal rate cuts.
The zloty rally runs into resistance as Polish monetary policy will probably stay accommodative for longer than expected because inflation remains extremely low.
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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