A small majority of analysts in a monthly Reuters poll predicted the Czech central bank would drop its limit on the value of the Czech crown in the next 12 months, allowing the currency to gain almost one percent against the euro. However, the analysts polled were divided on when or even if the cap would be abandoned. The one percent gain is a median that includes the forecasts of those who think the central bank will keep the cap, and therefore the crown will not rise.
The bank has reaffirmed that it would re-float the crown in mid-2017, after speculation that it would abandon the cap forced it to sell crowns heavily in the market. According to the October 3-5 Reuters poll of 47 analysts, the crown is not forecast to strengthen beyond the central bank's limit in the next six months. That is in contrast with the levels implied in six-month crown forwards, which have priced in a gain to about 26.9.
By the end of next September, the crown should reach 26.8, according to the median projection in the poll. The forecasts reflect a split in views over the timing of the cap exit. Asked when it might happen, five analysts said the bank could exit the cap in the fourth quarter of next year, three projected the second quarter and one the third quarter.