Holub Sees Case For Slight Increase In Interest Rates

The CNB has published the text of Bank Member Tomas Holub's interview for FocusOn, with the official noting that "we have to mentally prepare for the fact that year-on-year inflation will still jump in January, probably above 18%." He pointed out that this should be the peak of inflation and price growth will ease from there, with the disinflationary process set to accelerate in spring.

• The official noted that with the benefit of hindsight, he would say that the CNB had started raising interest rates "a little later" than they ideally should have done it. On the other hand, the CNB was ahead of major central banks and its action helped dampen inflationary pressures.
• Holub said that the Bank Board would be unlikely to continue raising interest rates at rapid pace even if its composition did not undergo a major overhaul last year. However, his personal view is that "it would be desirable to increase interest rates a little in order to speed up the reduction of inflation."
• According to Holub, another rate hike cannot be ruled out but he refused to speculate further. He noted that two new colleagues will join the Bank Board in mid-February and he does not know much about their views on monetary policy.
• Click here to see the full interview.