Czech President Miloš Zeman strongly criticized the central bank’s decision to weaken the crown, saying the move by the ČNB could slow down the country’s entry into the eurozone. “I would like to express my strong dissatisfaction with the Czech National Bank’s interventions which artificially pushed the rate beyond its real market value and slowed down our entry in the eurozone, be it an intention or not,” Zeman told the lower house of Parliament before Tuesday night’s confidence vote for the new cabinet.
Economists polled by ČTK, Pavel Sobíšek of UniCredit Bank and David Marek of Patria Finance, disagreed with Zeman. They point out that the country is not on the verge of entering the eurozone, and therefore, the bank’s intervention couldn’t hurt the process. In fact, Marek believes the intervention and the weaker crown will eventually help revive the Czech economy. The ČNB weakened the crown against the euro in November by about 7 percent in an effort to avoid deflation. The move sparked strong criticism.
