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CNB Governor Michl Says 25bp & 50bp Cuts Are Equally Possible Next Week

CZECHIA
  • On the eve of the media blackout, CNB Governor Ales Michl said that a 25bp and 50bp rate cut next week are equally possible and both would preseve restrictive monetary policy. The official said that long-term rates are of key importance and he would like to make sire that 3- to 5-year rates don't fall, which is why even another 50bp cut would be accompanied by hawkish messaging surrounding the outlook for rates. The Governor said that the central bank will remain data-dependent and the easing cycle can be halted at any point, even if it would be resumed shortly thereafter. The media blackout starts today at 14:00BST/15:00CEST and the Bank Board will announce its next decision on the repo rate on Wednesday (June 27).
  • In an interview for DenikN, Prime Minister Petr Fiala hinted that Trade and Industry Minister Jozef Sikela has the biggest chance to become the next Czech European Commissioner.
  • Finance Minister Zbynek Stanjura said that the cabinet is not implementing reforms as he would have liked. The official said that "what we enforced was on the edge of the minimum" and called for a braver approach to reforming the state.

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