The Czech National Bank (CNB) admitted yesterday that November’s inflation numbers came out 50 bps lower than expected. The main reason was that the surge in food prices faded far more quickly than had been expected, while another less prominent factor was the recent slowing of fuel price rises on world markets. But the central bankers will continue keeping a sharp eye out for price growth, claiming that the basic engine for price growth, continuing economic growth in the Czech economy, continues, as does wage inflation. At the same time, the weak Czech koruna is driving up import prices. The CNB continues to expect inflation to be at the upper range of its toleratnce level.
