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Retail Sales Shrink More Than Forecast, FX Reserves Data Due

CZECHIA
  • Czech retail sales contracted 7.3% Y/Y in December. The contraction was deeper than expected by analysts (-5.5%), even as it moderated from November (-8.7%), with consumer budgets squeezed by inflation and elevated interest rates.
  • The CNB will publish data on January international reserves and FX transactions. The central bank was likely not active in the FX market last month amid continued Koruna appreciation, which the Bank Board sees as a crucial factor in fighting inflation.
  • In a joint interview for E15, former CNB Governors Juri Rusnok and Miroslav Singer warned that inflation may stagnate well above the central bank's +2% Y/Y target, albeit neither of them called for immediate rate hikes as they took note of CZK strength.

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