RBA Hikes Interest Rate to 4.60% as Inflation Risks Rise 
Arthur Hayes Announces FLOP Testnet Launch Within Weeks 
US Gas Market Poised for Supercycle: Bernstein Analysts 
Energy Sector Outlook 2025: AI's Role and Market Dynamics 
Global Markets React to Strong U.S. Jobs Data and Rising Yields 
Ripple Mints 19.6 Million RLUSD Amid Banking Expansion 
RBI Uses $10 Billion Currency Swaps to Drain Excess Rupee Liquidity 
Philippines Current Account Deficit Seen at $19.1 Billion in 2026 
Fed's Hammack Urges Faster Rate Hikes to Fight Inflation 
Most Americans Oppose Election Betting on Prediction Markets, Poll Finds 
Cardano Hits Five-Year Transaction Record as ADA Price Falls 
Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
China's Refining Industry Faces Major Shakeup Amid Challenges 
Ripple-Backed Evernorth Set for Nasdaq Debut With 473 Million XRP 
U.S. Treasury Yields Expected to Decline Amid Cooling Economic Pressures 
Add as a preferred source on Google
In CEE FX space, last Friday conveyed two key pieces of data:
1) We received the flash estimate of Q4 GDP, which disappointed slightly at 0.5% QoQ against the consensus expectation of 0.7%. Full-year 2017 GDP growth worked out to 4.4%. Despite the slight disappointment in Q4, the GDP data are consistent with a strong economic upswing.
2) What was more interesting, export-import price data portrayed intensifying deflationary pressure from foreign prices - import prices were down 4.2% YoY in December. This continues a trend we have observed for longer than a quarter now, which makes it likely that inflation will undershoot CNB projections during H2’2018 and 2019.
This, in turn, means that CNB may not hike rates after the middle of 2018. The reading is mildly CZK-negative, although we are generally bullish about the currency in the medium-term.
The CZK is the best-performing CEE currency this year followed by the PLN. The HUF is lagging. Central banks are key drivers: The CNB almost seems eager to strengthen the CZK.
After strong gains in CZK, we scale down the OW in CZK as the central bank sounded dovish at its last meeting indicating to us a degree of discomfort with the pace of appreciation. However, we only expect a loss of momentum in the trade and not a reversal and hence we remain short EURCZK in cash.
Alternatively, stay short in forwards contracts of far-month tenors as we revise our end-2017 EURCZK forecast up to 25.0180, given the lower than expected volatility of the currency post floor removal.
FxWirePro launches Absolute Return Managed Program. For more details, visit:
