Two days before the anniversary of the Normandy landings, the Czech Statistical Office published preliminary data on May inflation. The figures were not much cause for cheer: the price level rose by 0.5% month on month, and had it not been for falling motor fuel prices the increase would have been even higher. Year-on-year inflation thus jumped from 1.8% in April to 2.4% in May, which the final data confirmed. The annual figure is 0.3–0.4 percentage points above market expectations and close to the CNB’s forecast (+2.3%). We fear that May’s developments will serve the CNB as an argument for leaving rates at their current level. The next monetary policy meeting of the Bank Board takes place on 25 June.
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