Final Word from Friday, June 28, 2002

When exporters complained about the strong crown in April, they won wide press coverage with their Trutnov Appeal and got the attention of the Czech National Bank. Since then, though, the crown has grown even stronger. Chair Vratislav Kulhánek of Škoda Auto, whose company signed the appeal, told Euro that the petition hasn't accomplished anything because it was badly put together. Analyst Pavel Kohout of PPF said today in Hospodářské noviny that either a big foreign direct investor is responsible for the latest jump in the crown, or portfolio investors fleeing from other markets are. He doesn't think the appreciation is part of a speculative attack, and he says the crown could still be undervalued. In other words, the strong crown is here to stay. Dealer Josef Jeřicha of ING told HN that manufacturers should have seen it coming.


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