PRAGUE, March 4 (Reuters) – Development over past week after U.S. and Israeli strikes on Iran may limit room for potential minor Czech interest rate easing if it discourages major central banks from easing policy on inflation fears, central bank Vice-Governor Jan Frait told news website
“If the development from the past week changes steps of foreign central banks, it will of course also lower the room for us to shift slightly lower,” he said in an interview, but he said he still somewhat expected the major foreign banks to ease policy.
He said he could not say at the moment how he would vote at the bank’s next policy meeting on March 19, saying the situation remained fluid.
Frait told Reuters in January there may be some room for up to two rate cuts this year due to external developments while the domestic economy did not warrant easier policy setting.
(Reporting by Jan Lopatka)