Singer: Czech economy passing through bottom of recession

Hradec Kralove, Feb 19 (CTK) - The Czech economy is passing through the bottom of recession now and inflation is not quite pleasantly heading below the target set by the central bank, Czech National Bank (CNB) governor Miroslav Singer said at a conference Tuesday.

The CNB has set its inflation target at 2 percent. Annual inflation dropped to 1.9 percent in January from 2.4 percent in December.

"At the moment inflation is heading quite safely and not entirely pleasantly deep below our target," Singer said at an economic conference at the University of Hradec Kralove in eastern Bohemia.

Nobody expects any sharp growth in prices, Singer said.

Inflation is pulled higher by things that do not reflect what is happening in the Czech economy, he said, mentioning regulated prices, indirect taxes and food prices among these aspects.

The Czech economy has been in recession for about a year and a half, Singer said.

"We are, or at least we think so, passing through the bottom of this decline," he said.

The CNB has revised its economic development outlook for this year downwards in its latest forecast. The central bank now expects a 0.3 percent drop of gross domestic product (GDP) for this year, while in the previous forecast it reckoned with a 0.2 percent growth.

In contrast, the central bank revised its GDP growth estimate for next year up to 2.1 percent from 1.9 percent it expected in November.

Singer also Tuesday opened at the University of Hradec Kralove the CNB's touring interactive exhibition that presents the tasks of the central bank in a popular form.

The exhibition, intended mainly for school children, was created on the occasion of the 20th anniversary of the Czech crown currency. It will also be presented in Plzen, western Bohemia, and Ceske Budejovice, southern Bohemia, in spring.