2023.03.2915:36:00UTC+00Czech Central Bank Holds Key Rate Unchanged At 7.00%

The Czech National Bank kept its key interest rates unchanged for the sixth straight meeting on Thursday amid an easing trend in inflation in recent months.

The board of CNB maintained its two-week repo rate at 7.00 percent, as expected. This was the highest rate since 1999.

The bank has tightened its monetary policy over the nine consecutive sessions until June 2022.

The discount rate was left unchanged at 6.00 percent and the Lombard rate at 8.00 percent.

The inflation rate eased to 16.7 percent in February from 17.5 percent in January.

The bank expects inflation to fall further in the coming months and reach single digits in the second half of 2023.

The winter forecast predicts inflation will slow and be close to the central bank's target band of 2.0 percent. This means interest rates will remain relatively high for some time.

The Bank Board assessed the risks and uncertainties of the outlook as being significant and going in both directions.

The central bank signaled that it would continue to prevent excessive fluctuations in the koruna's exchange rate.

The Bank Board assured the public that the CNB's actions will be sufficient to restore price stability in accordance with its statutory mandate.