RPT-Czech c.banker Niedermayer wants rate hikes-agency

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The Czech central bank should raise rates 'significantly' due to fast economic growth and the prospect of higher inflation, central bank's (CNB) Vice-Governor Ludek Niedermayer told Thomson Financial News on Wednesday.

The agency quoted Niedermayer as saying in an interview that the bank could not expect that a firming of the crown currency would help dampen inflation as it did in the past.

"For the stage at which the Czech economy is at now interest rates should be higher," the agency quoted Niedermayer as saying.

"Given that inflation is nearing our target (of 3 pct), the appropriate interest rates (would be) significantly higher."

The central bank has raised interest rates twice this year, by a total of 50 basis points, to 3 percent.

The seven-member board meets on rates on Aug. 30 with analysts uncertain whether its members see inflation pressures strong enough to warrant another rate rise following July's quarter point hike in the policy rate .

Niedermayer is widely seen as a rather hawkish member of the policy board.

The CNB has projected a rise in inflation above the 4 percent upper margin next year, assuming rates keep rising.

Analysts have said doves on the rate-setting panel now appear to be in minority, and most of them expect a further 25 basis point interest rate hike by September at the latest.

For profiles of CNB policymakers, click on [ID:nL28883806]

[PRAGUE/Reuters/Finance.cz]