Czech Central Banker Says Period of Low Rates `Ended,' Hospodarske Reports
Czech central bank board member Kamil Janacek said policy makers will “certainly” discuss the level of interest rates at their next meeting given the growth of exports and rising commodity prices.
“It’s certain that the period of low rates and their reduction in this economy has come to an end,” he said in an interview published today in Hospodarske Noviny. “Secondly, it remains a question as to how long this economy can have lower rates than the European Central Bank.”
Negative interest rates aren’t advantageous for the Czech economy and can lead to an outflow of capital, Janacek told the newspaper. “Slightly positive, real interest rates” can prevent the formation of bubbles in financial markets, he said.
Janacek said he isn’t against adoption of the euro, though a switch should occur only when it’s advantageous for the Czech Republic. Under current conditions, the euro region isn’t ready to accept a country like Poland or the Czech Republic into its ranks while it grapples with problems in Greece and other “southern” countries, Janacek was quoted as saying.
To contact the reporter on this story: Douglas Lytle in Prague at dlytle@bloomberg.net
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