Dollar, euro, banknotes – illustration photo.
Prague – The Czech currency is very strong at the moment, so tourists probably won't make much money if they exchange crowns for euros now before their summer vacation. Analysts contacted by ČTK agreed on this. They drew attention to the significant weakening of the Egyptian pound and the Turkish lira. The Czech currency traded at 23.70 CZK/EUR and 21.98 CZK/USD on Tuesday afternoon, according to Patria Online server data.
“The Czech koruna is currently very strong, which is why it can be generally said that we are in a very good period if it is necessary to exchange for another currency. It is very likely that the situation will not improve any more by the holidays, so there is no reason to postpone the exchange,” he said ČTK operational director of Fingo Jan Walter.
If people head to the Eurozone or the USA in the summer, it may be appropriate for them to exchange crowns now, agreed Purple Trading analyst Petr Lajsek. Of the popular summer destinations such as Croatia, Spain, Italy, France or Greece, all countries have the same currency, i.e. the euro. According to Lajesko, looking at the short-term development of the koruna against the euro, it is evident that the koruna has stopped strengthening. During April, the exchange rate attacked almost the threshold of 23 CZK per euro, and the koruna was thus not far from the historical minimum. From the perspective of the long-term development of the exchange rates of the koruna against the euro and against the dollar, it is evident that the Czech currency is still above average strong, he added.
Cyrrus economist Vít Hradil considers the recent weakening of the Czech crown against the euro as a return to realistic values. In the summer months, he expects further slight weakening of the Czech currency, according to him, it could approach the exchange rate limit of 24.00 CZK/EUR. In contrast, he currently sees the EUR/USD exchange rate as excessively flattering for the US currency, so he foresees a gradual move towards EUR/USD 1.10. For the exchange rate of the dollar against the koruna, this means a slight improvement in favor of the Czech currency, which could be near CZK 21.80 per dollar in the summer. For the purposes of exchanging crowns for euros, he considers the current exchange rate to be favorable, while according to him there is no reason to rush to buy dollars.
A holiday in Turkey can be very interesting for all citizens of the Czech Republic, Lajsek believes. The local currency has weakened significantly in recent years. While five years ago the Turkish lira cost five crowns, now these currencies are practically equal. The current exchange rate is close to the annual minimum and can thus be ideal for an exchange.
Another popular destination for Czechs in the summer is Egypt, and this country is also struggling with very high inflation, according to Lajesko. The performance of the Egyptian pound is one of the worst of any currency this year, he pointed out. A year ago, one pound cost 1.25 CZK, now 70 pennies will suffice. According to the analyst, Egypt is paying extra for the increase in food prices, this North African country was one of the largest importers of wheat from Ukraine and Russia, which significantly increased in price last year. Despite the still high inflation, according to Lajsko, it is possible that the central bank will try to lower interest rates, after which the pound could weaken further. Travelers to Egypt can thus pay off to wait a few more weeks to exchange money, he said.