Czech Republic: Another hike despite a strong CZK
In line with our expectations, the Czech central bank yesterday decided to lift its leading rate by a further 25bp, thereby bringing it to 3.75%. The Czech central bank board voted 5-2 to raise interest rates despite the fact that a strongly performing Czech koruna (CZK) had already brought monetary tightening, according to central bank governor, Mr Tuma.
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ECB more dovish than expected
Overview : The ECB yesterday kept rates unchanged as expected at 4.0%. In the press conference afterwards, the ECB softened its tone on growth putting more emphasis on the downside risks to growth. We had expected a move in this direction but the ECB softened more than we expected. While still sounding hawkish on inflation, with this move the ECB effectively went on a neutral bias, taking a rate hike off the table. The ECB also emphasised the high degree of uncertainty, and in this way gave
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