CNB maintains policy rate unchanged, signaling a pause after June’s hike despite lingering inflation risks.
The Czech National Bank kept its benchmark interest rate at 3.75%, aligning with market expectations. The decision marks a shift to a wait-and-see approach following a 25-basis-point hike in June, though the bank continues to flag upside inflation risks.
Governor Ales Michl indicated the current rate level is appropriate for now, focusing on core inflation rather than volatile fuel prices. The CNB cited robust wage growth and potential money supply acceleration as persistent inflationary pressures, though its tone lacked urgency.
The koruna weakened slightly after the announcement, with EUR/CZK expected to trade near 24.20 in the coming months as markets price in rate stability.