Czech National Bank likely to keep interest rates on hold in 2019, 2020

The Czech National Bank had hiked rates in the month of May. Following the hike, the central bank is expected to keep the rates on hold for the remainder of 2019 and also in 2020, said Erste Group Research in a report.

Domestic conditions are still pro-inflationary. Nevertheless, on the other hand, risks stemming from the world economy and low economic figures coming recently from the euro area have risen caution among bank board members, suggesting stability of rates as the most likely outcome.

“If the situation in the Eurozone economy worsens (e.g. if no-deal Brexit occurs with negative consequences for the Eurozone), the CNB could decrease rates at the end of this year”, added Erste Group Research.