The Czech National bank has gone on the offensive in an attempt to justify its decision to weaken the koruna last November. Its governor Miroslav Singer has been particularly active in the media of late, publishing articles on his official blog and appearing on the more important television news talk shows. In his recent appearance on national television over the weekend, he argued that the hike in inflation that critics feared after the central bank began buying foreign currency in bulk never materialized, though the currency sank to 27 koruna per euro, a 7 percent fall. Singer claims the step was necessary to prevent deflation and that recent price movements have been entirely normal.
“With groceries, you have a commodity where prices always jump quickly, while others remain stable. If we look at the numbers from mid-February, we see growth of 3.5 percent,half of which is normal growth toward the end of the year.”
