Czech wage growth unexpectedly accelerated in the fourth quarter, dealing a fresh blow to chances that the central bank will be able to cut interest rates this year. Nominal wages jumped 7.4% in the last three months of 2025, recording a 5.1% real increase, according to figures from the statistics office on Friday. Both readings topped the central bank’s projections for the quarter.

From the central bank’s perspective, the very important information about wage developments in the Czech economy represents an argument against thoughts about a potential slight decrease in interest rates, said Radomir Jac, chief economist at Generali Investments CEE. Policymakers discussed what they called a potential ‘fine-tuning’ rate cut last month as the inflation rate dropped below the 2% target, but soaring global energy prices after the US-Israeli attacks on Iran may shift the inflation outlook. The bank has held the key rate steady at 3.5% since the last rate cut in May.