The Czech National Bank surprised markets again. The CNB's bank board decided to cut interest rates by 25 bps at yesterday's meeting. The key repo rate thus dropped to 4.25% (the same rate of ECB is now 3.25%). CNB also announced a revision of its forecasts. GDP is expected to grow by 2.4-3.4% this year (previous forecast: 3.9%). Patria assumes GDP growth at 3.2%. CPI should land in the interval of 2.5-3.8% by the end of 2002 instead of previously expected 3.3-4.7%. Patria's inflation forecast amounted to 3.4%.
German consumer prices rose at the fastest pace in nine years in January, as food became more expensive and the introduction of euro notes and coins caused some retailers to round up prices. Another reason of the CPI increase can be found in higher excise taxes for tobacco and energy. It seems that ECB mistook claiming that the euro introduction did not affected inflation in the eurozone.
And now one hot news from the Czech party politics. The Quad Coalition has definitively died after today's meeting of its political board. ODA will take part in the parliamentary election alone or in a coalition with another parties.
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