The Czech koruna strengthened the most in almost three months after the monetary-policy council rejected central bank Governor Miroslav Singer’s push to sell the currency for a second meeting amid an economic recovery.
Floodwaters that inundated Prague and swamped large areas of central Europe may peak today as emergency crews work to open river traffic, drain submerged neighborhoods and count the cost of the storm damage.
The koruna weakened as Czech inflation stayed below the central bank’s target for a third month, fueling speculation on whether policy makers will try to stimulate the economy by weakening the currency.
The Czech central bank board voted 4- 3 today to leave the benchmark interest rate at a record low, showing the debate on the timing of policy tightening is intensifying as inflation and an economic recovery gather pace.
Czech Prime Minister Petr Necas is in a scrap to keep his job after prosecutors said one of his closest aides illegally ordered intelligence officers to spy on three people and was involved in a bribery case where ex- lawmakers were offered jobs at state-owned companies.
One year after the death of former Czech President Vaclav Havel, a global icon in fighting dictatorship, his persecutors’ political heirs have national power in their sight for the first time since 1989.