Interest Rate in Czech Republic
Czech Republic - Interest Rate
CNB stays put in August
On 1 August, the board of the Czech National Bank (CNB) unanimously decided to keep the two-week repo rate unchanged at 2.00%, marking the second consecutive hold and coming in line with market expectations. Moreover, the CNB also left both the Lombard and discount rates unchanged at 3.00% and 1.00%, respectively.
Inflation has lingered near the upper bound of the Bank’s 1.0%–3.0% tolerance band in recent months while economic activity has remained solid, powered by upbeat domestic demand. Although this could warrant tighter monetary conditions to some degree, survey-based indicators on manufacturing activity, in both the Eurozone and at home, point to industrial weakness. In addition, despite the Bank expecting inflation to remain above its 2.0% target in the coming quarters, it sees it easing at the start of next year, mainly due to previous policy tightening. Against this backdrop, the Bank was cautious and thus held rates.
In the accompanying statement, forward guidance was somewhat hawkish but in the press conference, policymakers indicated interest rate stability ahead. The Bank highlighted that the risks to its forecast are tilted to being “slightly anti-inflationary”, mainly reflecting a sharper slowdown in demand from the country’s main trading partners. Meanwhile, it noted that the impact from continued global trade conflicts and a disorderly Brexit continue to fuel uncertainty.
The next monetary policy meeting is scheduled for 25 September.
FocusEconomics Consensus Forecast panelists see the two-week repo rate at 2.03% at the end of 2019 and at 1.96% at the end of 2020.
Czech Republic - Interest Rate Data
|Policy Interest Rate (%)||0.05||0.05||0.05||0.05||0.50|
5 years of economic forecasts for more than 30 economic indicators.
Czech Republic Interest Rate Chart
Czech Republic Facts
|Bond Yield||1.22||-1.85 %||Jul 31|
|Exchange Rate||23.01||-0.66 %||Jul 31|
|Stock Market||1,057||-0.10 %||Jul 31|
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August 14, 2019
The economy grew 2.7% in year-on-year, seasonally- and price-adjusted terms in the second quarter, marginally down from the 2.8% upturn logged in the first quarter, according to a preliminary release by the Czech Statistical Office (CSO) on 14 August.
August 12, 2019
Consumer prices increased 0.4% from the previous month in July, up from June’s 0.2% increase.
August 6, 2019
Industrial production plunged 6.4% year-on-year in June, contrasting May’s solid 3.2% increase and marking the sharpest downturn since July 2016.
August 1, 2019
The manufacturing Purchasing Managers’ Index (PMI), produced by IHS Markit, tumbled from 45.9 in June to 43.1 in July, the worst reading in just over a decade.
August 1, 2019
On 1 August, the board of the Czech National Bank (CNB) unanimously decided to keep the two-week repo rate unchanged at 2.00%, marking the second consecutive hold and coming in line with market expectations.