Central Banks
Czech Rate Hawks Prevail as Inflation Risks Put Off Rate Cuts
- Board majority opted to keep ‘very restrictive’ policy for now
- Michl says cut or hold are options for December rate meeting
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The Czech central bank signaled that concern over inflation risks overshadows a weakening economy for now as policymakers left the door open to an interest-rate cut next month.
The monetary panel voted to keep the benchmark rate at 7%, even as two out of seven members sought a quarter-point reduction. Governor Ales Michl said most central bankers decided to keep the policy “at a very restrictive level” to prevent excessive wage demands from triggering an inflation spiral.