Czech crown may keep rates flat -c.banker-Bloomberg

...this month, CNB board member Vladimir Tomsik told the Bloomberg agency on Wednesday.

On Friday, CNB Vice-Governor Ludek Niedermayer made similar comments in a Reuters interview, saying that with the crown at record highs and the economic outlook uncertain, the CNB may take a pause in raising interest rates.

"I don't see a reason" to raise interest rates when the bank meets on Sept. 27, Tomsik said in a Bloomberg interview, although he added he could not rule out an increase.

The CNB raised its two-week repo rate three times over the summer -- each hike by 25 basis points -- to 3.25 percent as strong consumer spending, food prices and a potential seep-through of tax changes raised the inflation outlook.

But the crown, boosted by unwinding of carry trades, reversed its decline seen in the first half and climbed to an all-time high of 27.385 to the euro on Monday, before slipping back to 27.637 on Wednesday.

Economic data "are in line with the forecast, which anticipated higher rates. What surprised us was the exchange rate," Bloomberg quoted Tomsik as saying. Tomsik added that the crown rise was surprising and "that's why I'm saying to myself that yes, the latest data indicate that rates could remain unchanged. I really don't see any clear, strong inflationary factor".