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CNB Likely to Raise Policy Rate By 100bps on June 22

CZECHIA

LOCAL NEWS

  • The CNB is meeting on June 22 and is likely to hike its policy rate by 100bps to 6.75% (consensus is split between 100bps and 125bps hike).
  • This will be Rusnok last meeting as a Governor, following Ales Michl nomination as CNB’s new head (starting in July).
  • We previously saw that the rotation towards a more ‘dovish’ board (Benda and Nidetzky not reappointed, replaced by more dovish members – Zamrazilova, Kubelkova and Frait) could leave CZK vulnerable in the medium term as some analysts have been speculating that this may be the last ‘hawkish’ hike and that the CNB may announce the ‘end of its tightening cycle’ soon.
  • This morning, Cabinet ministers will meet representatives of employers and trade unions to discuss issues such as the economic impact of the war in Ukraine, the use of EU funds, employment of foreigners and the upcoming EU presidency (BBG).

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