Final Word from Wednesday, June 17, 2026

The Kafkaesque metamorphosis of Aleš Michl into Jiří Rusnok is one of the most important Czech economic events of the past two decades. On Nov. 15, 2021, six months before he was appointed governor, Michl wrote in MFD that the interest-rate hikes under Rusnok were "short-term activism" and that another "activistic policy" was the devaluation in 2013-2017. It was responsible for preventing us from having a strong crown, he said. At the end of last week, just after the ECB raised its interest rates, the new Michl told Bloomberg that the CNB's own rates might have to rise. "The real problem," he said, "is that there is too much money in the economy." Yet his board never took any real action to reverse the devaluation that he had so criticized and has instead adopted Rusnok's policy of a revaluation of the crown based on interest rates. The old Michl would keep interest rates unchanged tomorrow. The new Michl would do what Rusnok would do and move to keep the interest-rate differential unchanged. [ Czech National Bank European Central Bank currency ]