Czech National Bank

June 27, 2013

Monetary officials decided to keep the two-week repo rate at 0.05%, its level since a 20-basis point cut last November.  Inflation risks lie to the downside, and growth last quarter was negative and worse than assumed in both quarterly and on-year terms.  A statement speaks of a greater readiness to engage in currency market intervention because risks are “tilted toward a need for easier monetary conditions in comparison with the forecast.” 

From a high of 3.75% in 2008, the main central bank interest rate in the Czech central bank was cut to 2.25% by the end of that year, 1.0% by end-2009, and 0.75% by end-2010 where such remained until a 25-bp cut in mid-2012.  The most recent reductions were by 25 bps last September and the aforementioned 20 bps last November.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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