The GBP to CZK exchange rate is currently range-bound.
Key drivers include:
- The interest rate differential, with the Bank of England projected to cut rates to 3.25% while the Czech National Bank maintains a stable monetary policy.
- The UK faces fiscal concerns that could further pressure the pound as growth slows.
- Czech inflation is easing, potentially supporting the koruna's strength.
In the near term, GBP/CZK is expected to fluctuate within a stable range, reflecting its recent 2.6% variation from around 27.37 to 28.09.
An upside risk could stem from unexpected strength in the UK economy or a delay in BoE rate cuts. Conversely, a downside risk is connected to worsening global trade tensions or ongoing fiscal uncertainties in the UK that could further impact GBP performance against the koruna.