INSTANT VIEW 2-Czech c.bank ups rates by 25 bps

...Thursday:

ALES MICHL, ANALYST, RAIFFEISENBANK, PRAGUE

"This is no drama, we still have the lowest rates in the European Union.

"Today's step was triggered mainly by the unexpectedly weak crown versus the euro. The exchange rate no longer dampens inflation as we have been used to.

"Record-strong household consumption and robust retail sales also called for a rise in interest rates.

"Today's vote on the board was probably very close. A further rise in rates will in our opinion come within three months, probably in July."

LAUREN VAN BILJON, ANALYST, 4CAST CONSULTANCY, LONDON

"It's likely that voting was close, but the absence of dovish (member Vladimir) Tomsik left an opening for the hawks.

"It was only a few months ago that the CNB board was talking about rates remaining flat over the medium term, but since then data have been pointing to rising inflationary pressures within the economy.

"The dovish members of the board were keen to wait a little while longer before raising rates, with several having mentioned forthcoming Q1 data as important. However, the hawks have been pressing for a rate hike before inflation is clearly present in the data, and it seems that they won out in the end."

Keywords: CZECH ECONOMY/CENTRALBANK RATES

[PRAGUE/Reuters/Finance.cz]