Czech Republic CZ CNB Repo Rate November 4 2021

What does the data mean to the market?

The Czech Republic's benchmark interest rate is set by the Czech National Bank (CNB). The official interest rate is the two-week repo rate, a rate at which commercial banks can place excess funds at the end of the day with the Central Bank.

Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation.

A higher than expected rate is positive/bullish for the CZK, while a lower than expected rate is negative/bearish.

Historic deviations and their outcome

February 6 2020 Today we saw a 0.25% deviation from the forecast, which gave a lovely and steady 190 pips move over about 15 minutes which would have provided plenty of opportunities to enter.

Check out the price action here.

https://calendarapi.galaxysoftwareinc.com/l/aHR0cHM6Ly9jYWxlbmRhci5nYWxheHlzb2Z0d2FyZWluYy5jb20vIy9jaGFydDtpPTE1MDc0O3Q9MjAyMC0wMi0wNiUyMDEzOjAwOjAwLjA7cz1VU0RDWks7cj1NMQ

I will use forecasts of:

CNB Repo Rate 2.25

Today's trade plan

Today we have a forecasted change to the interest rate to 2.00%, a 0.50% hike to the current Interest Rate. There are some opinions out there that they might increase more to 2.25% so I will only take a buy if we see a hike to 2.50%

Tradable pairs

EURCZK
USDCZK

Hope this helps but please do your own analysis!!

Good luck!!

James Thatcher

Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Past performance is not indicative of future results. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.