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UPDATE 1-Czech central bank's Benda delivers hawkish rate outlook - news website

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(Adds quotes, crown firming, market reaction)

PRAGUE, Oct 12 (Reuters) - The Czech economy would benefit from a 50-75 basis point interest rate increase before the end of this year, Czech National Bank board member Vojtech Benda was quoted as saying on Thursday.

The central bank raised its main two-week repo rate to 0.25 percent in August, the first rise in nearly a decade, as the domestic economy was growing fast and inflation was firmly above the central bank's target.

Higher rates are justified by wage growth and the only slight firming of the crown currency since the central bank dropped its exchange rate cap in April, Benda told , the online version of the daily Hospodarske Noviny.

"It is apparent that the economy is already showing certain signs of overheating," Benda was quoted as saying.

"It is not so fatal so far that it should be overflowing into inflation, but we can thus easily continue with increasing interest rates."

Benda and two other board members formed a minority on the seven-strong board to support another hike already at the last meeting on Sept. 27.

The bank holds two more policy meetings this year, on Nov. 2 and Dec. 21, after the country holds an election on Oct. 20-21.

"In theory there could be one or two more hikes by the end of the year," Benda said.

He said he backed gradual increases by 25 basis points each, which could continue into 2018.

He said that from his perspective, the bank's current forecast seeing the 3-month interbank offered rate at around 0.6 percent in mid-2018 was too low.

Analysts in a Reuters poll prior to the Sept meeting saw the main two-week repo rate at 0.5 percent at the end of this year and at 1 percent only at the end of 2018. The crown firmed by 0.1 percent to touch 25.85 to the euro after Benda's comments.

(Reporting by Jan Lopatka and Robert Muller; Editing by Alison Williams)

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