High European gas prices are keeping downside risks elevated for Central and Eastern European (CEE) currencies, ING said, as it sees a Czech rate increase having less sway than energy costs.
ING EMEA FX and Fixed Income Strategist Frantisek Taborsky wrote that “the market is primarily driven by energy prices, with the CNB having relatively little impact.” ING forecasts a 25-basis-point increase in the Czech National Bank's (CNB) two-week repo rate, from 3.75% to 4.00%, at the Nov. 5 meeting. The CNB's official calendar lists that date, but the rate decision has not been announced.
The Dutch front-month TTF natural gas contract briefly reached €100 per megawatt-hour on Oct. 28, Reuters reported, citing Intercontinental Exchange data. Investing.com historical data lists a high of €100.945 for the November 2026 contract that day and a close of €98.500. Reuters attributed the price move to Middle East shipping interruptions that were curbing liquefied natural gas availability ahead of winter. The outlet said rising wholesale prices were increasing gas and electricity costs for households and industrial users. It also reported that energy-intensive sectors such as chemicals, fertilizers and steel faced higher input costs. For comparison, Reuters cited a TTF peak of about €340 per megawatt-hour in August 2022.
CNB board member Jakub Seidler said in an Oct. 27 interview hosted by the central bank that he was inclined to support a November hike. He said he had not yet reviewed staff analysis and recommendations, and that one increase would not necessarily signal a series of rate hikes. The CNB last raised its two-week repo rate in June, to 3.75%.
Taborsky said some relief in EUR/USD and firmer equity markets may help CEE currencies stabilize in the short term, while gas prices underpin ING's bearish medium-term view. The assessment follows ING's earlier discussion of uneven pressures across CEE currencies. The CNB's next monetary policy meeting is scheduled for Nov. 5.
