Czech central bank chief: rates can rise slower now as we are in comfortable position

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PRAGUE, Nov 25 (Reuters) - The Czech National Bank is in a comfortable position with interest rates now and it can tighten policy further at a more moderate pace, Governor Jiri Rusnok said on Thursday.

The central bank stunned markets with a 125-basis-point rate hike at its last policy meeting on Nov. 4, its biggest since 1997, which raised the key two-week repo rate to 2.75% as the bank aims to prevent inflationary expectations from decoupling.

Rusnok said that there was no reason for such steep moves anymore, and added he saw closer-to-standard hikes in future, while he could even imagine a pause in December.

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"Of course, I assume there will be a proposal for a rate hike, but I would expect it to be in some more or less normal framework," Rusnok told Reuters.

"We have the comfort now not to rush and to think about what does it look like, and to observe the developments to the last moment and then decide accordingly," he said.

The bank has leeway after it hiked the main rate by 200 basis points in two steps at its last two meetings in November and September.

"I can imagine also not hiking (in December), because we are not going to miss anything, we are not behind the curve, we are back at the curve, and we can afford such comfort," he said.

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Reporting by Robert Muller; Editing by Toby Chopra

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