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Czech Rate Hike Predicted

Czech Rate  Hike Predicted Czech Rate  Hike Predicted

The Czech central bank will probably raise interest rates for the third occasion in less than a year on Thursday and for the first time since 2013 release a currency outlook that may guide investors on what to expect in further monetary tightening. The Czech National Bank will raise its main interest rate to 0.75% from 0.5%, according to 20 of 22 economists surveyed by Bloomberg. Two analysts expected no change. The quarterly staff forecast will disclose projections for the koruna exchange rate, crucial to policy deliberations as central bankers try to cool one of Europe’s fastest-growing economies. “The new CNB macro forecast will probably depict an even more bullish outlook, reinforcing the call for tighter monetary policy,” said JPMorgan Chase & Co. economist Jose Cerveira, who expects four 25 basis-point hikes this year. The koruna was little changed at 25.31 per euro, after strengthening 1% this month and 6.9% since the removal of the central bank’s 27-per-euro cap. Earlier this week, prospects of more rate hikes helped lift the yield on 10-year government bonds to more than 2% for the first time in almost four years. The security traded at 1.98% on Wednesday.

 

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