The chief of the central bank says that major interventions of the Czech great crown are less likely

© Reuters. Coins and banknotes of the Czech Crown are seen in this illustration taken April 1, 2017. REUTERS/David W Cerny/Illustration

PRAGUE (Reuters) – The Czech National Bank is unlikely to have to intervene as much in currency markets as it has done in recent months as pressure against the crown is strong, Deputy Governor Eva Zamrazilova said on Sunday. .

The central bank has intervened to support the crown since May as part of an effort to combat high inflation for three decades, as the crown and central European currencies face pressure as a The energy crisis caused concern about their economies and as interest rates rose in the region ended while major central banks around the globe started raising their own rates.

In July, the Czech National Bank (CNB) used 10 billion euros ($10.35 billion) of its massive international reserves to back the crown. The amount of the intervention fell to 2.6 billion euros in September, according to bank data.

“There are a lot of shorter, smaller, more expensive episodes, but I don’t expect a return of those episodes in the near future,” Zamrazilova said during a Sunday debate program on Television. Czech.

“Overall, sentiment in the region is better now.”

Zamrazilova voted with a 5-2 majority at the bank’s November 3 meeting to keep the main interest rate at 7.00% despite the staff’s new forecast suggesting a rate hike. The bank uses interventions to compliment its policy.

Zamrazilova said she expects inflation, which fell to 15.1% in October, to drop to single-digit levels in the second quarter of next year.

The crown is trading at 24.28 against the euro and last week hit its highest level since before Russia invaded Ukraine in February. Interventions have kept the crown in a narrow range and at a strong 24.78 since they started.

CNB’s reserves fell to €131.6 billion at the end of October, or about 48% of the projected 2022 gross domestic product, from €160.4 billion seen in April.

($1 = 0.9660 euros)

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