Czech National Bank: Inflation to be above 2% target

Published: 16.08.2019 Related countries:  Czech Republic Czech Republic

Inflation will be above the Czech National Bank’s 2% target in the quarters ahead and will decrease close to the target over the monetary policy horizon.

This was agreed by central bankers at their meeting on August 1, 2019, when they unanimously decided to keep interest rates at their current levels. The brisk growth in prices in recent months was due mainly to core inflation, which reflected persisting strong domestic price pressures. Inflation was also affected by continued high growth in administered prices and recently also by stronger growth in food prices.

Inflation will start to decrease at the start of next year, owing to the previous monetary policy tightening and an unwinding of the currently high growth in administered prices. However, the decrease in inflation will be slowed throughout 2020 by the impacts of changes to indirect taxes. It will be close to the target at the monetary policy horizon (2H 2020).

CNB bank board members stated that the pessimism in the world has not significantly impacted the Czech economy.

 

Source: ČIA

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