CNB governor: Czech wage growth unsustainable

CNB governor: Czech wage growth unsustainable

Published at: 2019-03-12 09:39 | Author: CIJEurope.com
Asked by the weekly Euro if he thinks the Czech economy will make a safe landing from its extended boom, the governor of the Czech National Bank Jiri Rusnok says even though the bank increased interest rates five times in 2018, "I have to admit that if we'd continued in the policy of normalizing our foreign exchange policy we would now be in a more comfortable situation. We expect a slowing of the economy," he continued. "We don't know how long and how deep it will be and it's always comforting to have more space to loosen your foreign exchange policy. But we are where we are." Rusnok said the current situation is tricky to evaluate because there are both signs of a slowing, or even a recession, while other indicators suggest that nothing serious is in the cards for the Czech or the European economy. Asked how concerned he was about rising wage levels, he said that "Such a rapid rise in wages isn't sustainable. We think that it will begin to slow and will return to a more normal level of 5 percent."

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