Consumer prices in March increased by 0.1% m/m, according to our estimates. Year-on-year inflation should rise to 1.7% from 1.5% in February. The increase in fuel prices has influenced the inflation rate the most. The strengthened koruna
against the dollar provided only partial compensation for the higher oil prices. Inflation should be softened by the lower recreation prices. The core inflation rate, which is important for monetary policy, is about 1.5% and during the year it should move up closer to 2%. In line with this development, we are anticipating a small interest rate hike in the second half of the year.