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Financials

Czech central bank keeps outlook for end of FX cap in mid-2017

PRAGUE, Nov 3 (Reuters) - The Czech central bank reiterated on Thursday it expected to scrap its cap on the crown exchange rate around mid-2017 when inflation is expected to pick up enough to meet the bank’s 2 percent target.

The bank also reiterated it would not remove the cap which keeps the crown on the weak side of 27 to the euro before the second quarter of 2017, using interventions when needed.

The bank also presented a largely unchanged economic and inflation outlook seeing growth just under 3 percent in 2017-2018 and inflation at 2.3 percent in the fourth quarter of 2017.

It said risks to the forecast were balanced, with uncertainties stemming from policy settings of major central banks, Britain’s decision to leave the European Union, the speed of a revival in domestic investments and an October 2017 Czech parliamentary election’s impact on budget spending. (Reporting by Jan Lopatka; Editing by Jason Hovet)

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