Czech c.bank starts meeting, mkts expect rate hike

...25 basis point interest rate hike to tame resurgent inflation and offset a weaker crown.

The main policy rate has held at 2.75 percent following a quarter of a percentage point increase in May aimed at containing budding inflation pressures in the fast-growing central European economy.

A announcement on the interest rate verdict is expected sometime after 12 p.m. (1000 GMT). The CNB scheduled a news conference for 1330 GMT.

All but one of 15 analysts in last week's Reuters poll expected the CNB to raise the main two-week repo rate to 3.0 percent, its highest in nearly five years. One lone voice expected no change until September at the earliest [CNB/INT].

The economy's boom has been fed by an upturn in the neighbouring European Union economies, which are key export markets, and a rapid expansion of credit to households to finance home building and consumer purchases.

A pick-up in inflation, a tighter labour market and the strong economic growth -- topping 6 percent annually over the past two years -- have all led investors to believe interest rates will gradually rise this year and next year.