CZ: CNB provides no guidance

Instant Comment , 25. Jun
CNB sees inflationary risks

The CNB press conference did not bring any significant surprises, in our view. The first piece of information is that today's vote was unanimous, at 7:0. This is unsurprising given the May rate cut and recent data from the Czech economy.

Secondly and more importantly, Governor Michl highlighted recent inflationary data, which was reflected in the change in the board's statement from today's meeting, indicating inflationary risks. However, as in previous press conferences, the CNB provides no guidance for the next meeting(s) and communicates that all options are open. This aligns with significant bidirectional uncertainty in both the global and Czech economies.

Overall, today's press conference does not change our view described in the previous commentary following the monetary policy decision, that current macro data are trending more inflationary than initially expected, increasing the likelihood of a slightly longer period of stable rates. However, clarity on this matter will emerge in a few months.