The Czech National Bank decided to leave interest rates unchanged on its meeting today. All seven MPC members voted for keeping policy on hold.
GDP lagged behind CNB's forecast in Q1. On the other hand, CPI exceeds central bank's projection. In monetary policy horizon of 12-18 months, inflation is expected to be close to the inflation target.
CNB' governor Zdenek Tuma noted at the press conference after his last meeting that risks to the inflation forecast are roughly balanced and, thus, the stable rates are the most likely scenario for coming months. A turnover of the monetary policy towards tightening can be expected in 2011.