HIGHLIGHTS-Czech central bank monthly news conference

...conference on Thursday following a decision to keep interest rates on hold for a seventh consecutive month.

For a news report on the decision, click on [ID:L26624395].

ON INTEREST RATE OUTLOOK:

"It seems to me that at least among some members of the bank board, and I dare to say among most of them, now has a prevailing opinion that it is becoming more likely that the next move in interest rates will be upwards.

"This is a certain shift when we look at the previous months when we had been counting on (interest rate) stability in the next months and had been saying that we were rather symmetric about the risks ... and that we could have imagined a (rate) move in either direction.

"But as far as the timing (of any rate increase) is concerned, I am not able to say when this move will come."

ON THE UPDATED INFLATION FORECAST:

"A change that is worth pointing out is ... that the real economy will be pro-inflationary in both years (2007 and 2008).

"If we adjust (the inflation forecast) for the primary effects (of tax changes), inflation is seen moving rather in the lower half of the tolerance range (of the 3 percent target)."

"The primary effects have been exempted when setting policy ... so there is no change to policy conduct in that respect."