28 Jul 2021 14:51
The EUR/CZK currency pair is a popular one on Forex market. Since the Czech Republic has an active trade with the European Union, the experienced traders choose this trading instrument because of high stability and predictability of the eurozone and the Czech Republic's economies. The most intense EUR/CZK bidding is observed during the european session.
This pair is the cross rate against the U.S. dollar. There is no U.S. dollar in this currency pair, but the euro and the Czech koruna are under its great influence. To see it graphically, just combine the EUR/USD and USD/CHK charts in the same price chart, and you will get the approximate chart of EUR/CZK.
The U.S. dollar extends an enormous influence over both currencies. Therefore, for a better prediction of the future rate movement of this currency pair you should consider the main economic indicators of the U.S.A., such as interest rate, GDP, unemployment, new created workplaces indicator and many others. Remember that the currencies listed above can react differently react to the changes in the economic situation in the United States.
The economy of the Czech Republic is considered as prosperous and stable and it puts this country among the most advanced and industrial countries of the Central Europe. Its economic development is provided by the high rate of personal income.
Machinery, iron and steel production, chemical industry, electronics, beer production, as well as agriculture are the main economic sectors of the Czech Republic. The most developed industry sector is the automotive. This automobile sector's output, which mostly goes on export, has one of the highest rates of car production in the world. Moreover, the Czech Republic is one of the largest exporters of beer and shoes. The Czechs also export a variety of chemical products like tires, synthetic fibers, etc. The Czech Republic has an active trade with Germany, Russia, Slovakia, and Austria. A wide rage of possibilities to produce the electric power(nuclear, thermal, hydro, and solar and wind power) makes it one of the European leaders of the electricity production.
If you trade cross rates, pay your attention to the spread that can be higher than for more popular currency pairs. Thus, before you start dealing with cross currency pairs, read and understand the broker's conditions for this specified trade instrument.