Marek Mora Backs Higher Rates Amid Need To Cool Jobs Market

Bloomberg runs comments from outgoing CNB Deputy Governor Marek Mora, who reiterates his call for higher interest rates, pointing to the need to pour cold water on overheated labour market.

• Mora said that CPI growth will slow after reaching a peak this month but labour-market resilience, which is a "mystery" amid recession concerns, may delay a return to the inflation target.
• He agreed that "headline inflation will ease relatively quickly this year to single digits" but cast doubt on the prospect of a swift return to the target.
• "Monetary policy should act preemptively to cool the labour market and preclude elevated wage demands," Mora said.
• The official argued that raising rates would allow the CNB to ditch its FX intervention regime, which distorts the market and undermines the transparency of monetary policy.
• Mora has been a hawkish dissenter among CNB policymakers, with most of his colleagues from the Bank Board preferring stable interest rates, even if they will have to stay high for longer.