fxstreet.com 08 Feb, 2021 09:00 am

Inflation to drop in January due to base effect

Inflation to drop in January due to base effect
This week, December industrial output will, along with trade balances, be published for the remaining CEE countries. We expect that industrial output

The Czech koruna continued to appreciate after the central bank's meeting and the EURCZK broke the 25.In the Czech Republic, we even saw the mid part of the yield curve increase about 10bp, as the market started to listen to the central bank more carefully and price in higher rates in 4Q21 (6x12 forwards moved up 20bp last week).Central bank kept rates unchanged.Since the re-introduction of containment measures in 4Q20, the CEE Recovery Index has been fluctuating below the level observed during the summer months.

In the last week of January, the CEE Recovery Index dropped somewhat.The partial easing of restrictions in some of the CEE countries as of the beginning of February could likely result in increased mobility and push the CEE Recovery Index up slightly.

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