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Czech inflation accelerated at the end of 2021 but the focus of investors has already shifted to the start of this year when consumer prices are expected to rise at the faster pace in over two decades.
The annual inflation rate rose to 6.6% in December, from 6% in the previous month, data from Czech Statistics Office showed Wednesday. Three central bank board members said this week that price growth may approach 10% in early 2022, before it starts slowing later in the year.
The central bank has pledged to continue with one of the European Union’s most aggressive campaigns of interest-rate increases, after lifting borrowing costs by a cumulative 3.5 percentage points since June.
- Biggest contribution to annual December inflation came from cost of transportation and housing
- While commodity prices and supply-chain problems are among key price drivers, the central bank says its monetary-policy tightening is aimed at preventing current high inflation from becoming a long-term phenomenon
- The Czech Republic has the lowest jobless rate in the EU and policy makers want to prevent a wage-price spiral
Read more:
- Czech Rate Setters Saw Longer Inflation Pressures, Minutes Show
- Czechs Hoard Inflation Bonds as Fear of Runaway Prices Grows
- Czechs Say Rate Hikes Aren’t Over After Another Surprise Move
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