President Zeman Taps Jan Prochazka & Jan Kubicek To Become Bank Board Members

Czech President Milos Zeman nominated Jan Prochazka and Jan Kubicek to replace outgoing CNB policymakers Marek Mora and Oldrich Dedek when their terms expire in mid-February, while Jan Frait has been promoted to Deputy Governor.

• Prochazka is former chairman of state-owned EGAP insurance company, while Kubicek is is head of the Czech fiscal watchdog. None of them has any substantial monetary policy experience and little is known about their specific views.
• Earlier this year, Zeman replaced several Bank Board members including the Governor, which pushed the rate-setting committee in the dovish direction, resulting in a halt to the rate-hike cycle that took Czechia's policy rate to 7%.
• Speaking after the announcement, CNB Governor Ales Michl emphasised that fighting inflation is the central bank's top priority, adding that it will seek to prevent excessive Koruna moves. The Governor noted that he expects inflation to ease significantly in the spring of 2023.
• Meanwhile, Zeman said that he sees no reason to raise interest rates any further. Elsewhere, one of the main contenders for presidency Andrej Babis told E15 that if elected, he would try to persuade the CNB to lower interest rates as soon as possible.