As the European Central Bank’s (ECB) next policy meeting looms, the governor of the Czech central bank has insisted that further euro zone easing will have “necessary” knock-on benefits for the Czech Republic.
The ECB is expected to leave monetary policy unchanged on Thursday, although there are growing calls for the bank to launch a full-blown quantitative easing package.
ECB President Mario Draghi is likely to wait until the new year before deciding on sovereign bond-buying measures – a move that Czech National Bank (CNB) Governor Miroslav Singer said he supported.
“It (further easing) is helpful for us. ECB easing is necessary for us, we are closely related with the euro zone and ECB easing should, in the long run, generate more demand in the euro zone, which is helpful for us,” Singer told CNBC.
Speaking from the CNB in Prague, Singer said that easing could take some time to filter through to some weaker parts of the euro zone, but added that a weaker euro would help “shield” the Czech Republic’s economy by giving some of the region’s biggest countries a boost. The Czech Republic is a member of the European Union, but doesn’t yet use the euro. Its currency is called the Czech koruna.