Sell-Side See CNB Unchanged Through Upcoming Inflation Spike

On yesterday's CNB decision, sell-side of the view that the decision was inside of expectations:

• Commerzbank write that it is clear that the CNB would like to avoid a rate hike in the near future. From an FX approach, this does not make the CZK particularly attractive. This may suggest the CNB might be too hesitant on inflation and may drop behind the curve.
• ING write that January inflation may bring some headaches, but it should not be enough to hike rates. They add that nothing much has changed with this week's decision, but they do expect inflation to rise further in the next two months, albeit not high enough for the CNB to change their current rhetoric.
• JPM write that the decision came as no surprise, with communication still striking a cautious tone. They expect CNB rates unchanged at 7% until at least H2'23, with easing to commence in August. The upcoming board reshuffle will produce 6-1 vote splits going forward, so there remains a risk easing could come sooner than expected.