Czech National Bank expected to raise interest rates to 4 percent

Analysts and members of the Czech National Bank (CNB) board anticipate a 25 basis point increase in the key interest rate at the upcoming November 5 meeting, potentially raising it from 3.75 percent to 4 percent.

Board member Jakub Seidler expressed support for the hike, citing resilient domestic demand and sustained high energy prices. Inflation accelerated to 2.5 percent in September, and Seidler warned that inflation could rise to 3.5 percent early next year, exceeding the CNB tolerance band.

Economists note that rising rates will increase costs for mortgage holders. For a 4 million CZK loan with a 25-year term, monthly payments could rise from approximately 25,300 CZK to 25,900 CZK if the rate increases by another quarter percentage point.