Nearly all responses were received before Prime Minister Bohuslav Sobotka announced on Tuesday that he and his government would resign over a dispute with Finance Minister Andrej Babis, a big gamble before elections due in October. But the government's collapse did not come out of the blue, and analysts see the currency as largely immune from politics. "The Czech economy has shown itself largely impervious to political shocks," said Peter Attard Montalto, analyst at Nomura.
Elsewhere in central Europe, where economies are expected to grow 3-4 percent this year and next, the Romanian leu is expected to gain 1.6 percent and the Hungarian forint 0.7 percent in the next 12 months. Poland's zloty is seen giving up a small part of its recent gains, but its projected rate, 4.22 against the euro, is firmer than the 4.265 forecast in last month's survey.
Serbia's dinar is predicted to shed 1 percent. The crown could well outperform regional peers, as a month ago the Czech central bank (CNB) removed a cap which since 2013 had kept the currency weaker than 27 against the euro. It spent tens of billions of euros defending the cap as investors speculated on a surge of the crown when it was removed. But investors' crown holding grew so big fears of a sell-off have kept a lid on the currency, and its swings since the end of the cap have been much smaller than expected.
Before it was scrapped, some investors said the crown could go as strong as sub-25, while others said it would weaken past 29 if the cap was removed. But so far it has stayed between 26.5 and 27.16. According to the medians in the poll, it will trade between 26.5 and 27.15 through to end-June. "I think we will see EURCZK likely stable around here (26.9), however, through the coming few months on the back of the political noise and until EU structural fund inflows and possible CNB (interest rate hikes) occur," Nomura's Montalto said.