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ING's Frantisek Taborsky highlights that Central and Eastern European (CEE) currencies face downward pressure due to rising oil prices, geopolitical tensions, and elevated inflation expectations. Central banks in the region are anticipated to maintain aggressive tightening cycles, but the combination of energy costs and inflation risks could weaken local currencies further. Market participants are closely monitoring how these factors interact with global monetary policy shifts.
For traders, the risk-off sentiment in CEE markets presents volatility opportunities, particularly in currency pairs involving the Czech koruna (CZK), Hungarian forint (HUF), and Polish zloty (PLN). Geopolitical uncertainties, especially Russia-Ukraine dynamics, may amplify currency fluctuations. Energy-dependent economies like Hungary and the Czech Republic are particularly vulnerable to oil price swings.
Investors should watch upcoming central bank decisions in the Czech National Bank and the National Bank of Hungary. A failure to balance inflation control with growth support could trigger capital outflows. Additionally, global oil price trends and Fed policy signals will remain critical for CEE currency trajectories.
