Thursday, March 24, 2011

Czech National Bank Holds Rate at 0.75%

The Czech National Bank maintained its benchmark two-week repo rate unchanged at 0.75%, the Bank also held the discount rate unchanged at 0.25% and the Lombard rate at 1.75%. The bank cited rising commodity prices as presenting upside inflation risk, as well as the planned increases in VAT. Though the Bank also cautioned on downside inflation risks stemming from a weak domestic economy and strong Koruna. The Czech economy grew 2.6% y-o-y and 0.3% q-o-q in 2010 Q4, with the key drivers being investment in inventories, and to a lesser extent, net exports.


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