Czech Central Bank Chief Says Rate Cut Hinges on Core Inflation

The Czech central bank may have “some room” to lower interest rates if it sees easing pressures in core inflation but it will still keep borrowing costs higher than before the coronavirus pandemic, the bank’s governor said.

Policymakers in Prague last week kept the benchmark rate at 3.5%, where it’s been since May. They pointed to domestic price risks as an obstacle to further monetary easing, although the board discussed the possibility of what some members described as a fine-tuning of the rate-cutting cycle.