At its November 2026 meeting, the Czech National Bank raised its repo rate by 25 basis points to 4%, in line with market expectations. This move brought borrowing costs to their highest level since early 2025. Preliminary estimates show that headline inflation eased slightly to 2.4% in October from 2.5% in September. Nonetheless, robust domestic demand, together with rising energy and food prices, continues to generate upside inflationary pressures.
Although inflation remains within the CNB’s 1%–3% tolerance band, it is projected to peak at an average of 3.5% in the first quarter of 2027. With price stability still the central bank’s primary objective, core inflation remains a particular concern, having reached 3.1% in September—above the upper bound of the tolerance range.
