CNB keeps interest rates unchanged, decides on interventions

The CNB Bank Board decided at its meeting today to keep interest rates unchanged. The two-week repo rate was maintained at 0.05%, the discount rate at 0.05% and the Lombard rate at 0.25%.

The Bank Board also decided to start using the exchange rate as an additional instrument for easing the monetary conditions. The CNB will intervene on the foreign exchange market to weaken the koruna so that the exchange rate of the koruna against the euro is close to CZK 27.

The history of the settings of the main instruments of monetary policy and the Bank Board minutes are available at
https://www.cnb.cz/en/monetary-policy/instruments/#mpi
https://www.cnb.cz/en/monetary-policy/bank-board-decisions/

Repo rate: The CNB’s key monetary policy rate, paid on commercial banks’ excess liquidity as withdrawn by the CNB in two-week repo tenders.

Discount rate: A monetary policy rate which as a rule represents the floor for short-term money market interest rates. The CNB applies it to the excess liquidity which banks deposit with the CNB overnight under the deposit facility.

Lombard rate: A monetary policy interest rate which provides a ceiling for short-term interest rates on the money market. The CNB applies it to the liquidity which it provides to banks overnight under the lending facility.

Marek Petruš, CNB Spokesman