Czech Koruna Whipsaws as Central Bank Lifts Currency Cap: Chart

The Czech koruna fluctuated against the euro after policy makers in Prague ended a three-year cap on gains in the currency, swinging between a 0.9 percent advance and 0.5 percent loss within minutes. Investors had ploughed an estimated $65 billion in speculative capital into local assets to bet on a rally after the limit was lifted, even as rate setters warned they may have trouble locking in profits due to the lack of koruna buyers. The Czech National Bank has said it won’t be overly sensitive to initial swings and will only intervene to mitigate excessive market moves.

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