The Czech Republic’s annual inflation rate remains under control at 1.7 percent, slightly below the national bank’s 2 percent goal. It was 6 basis points below what the bank had anticipated, primarily because of lower than expected food price increases. The Czech National Bank had also anticipated slightly higher fuel prices, but these failed to materialize, while its predictions for the impact of non-direct taxes proved accurate. However, the bank wrote in a recent report that wage pressure would force it to remain on the alert as would the increasing strength of the Czech crown, which is driving up the prices on imported good. Looking ahead to 2019, the CNB anticipates that inflation will hold below its 2 percent goal at least in the first half of the year.
