Central bank: no need to further loosen monetary policy

The members of the Bank Board of the Czech National Bank agreed on Friday that there is no need to further loosen monetary policy in connection with the economic impacts of the coronavirus crisis. Its drastic easing, which took place in previous months, was, according to the board, adequate and creates sufficiently relaxed monetary conditions.

As the crisis unfolded the central bank cut all key interest rates in three steps. It first lowered the key two-week repo rate by 0.5 percentage point on 16 March 2020, then by another 0.75 percentage point on 26 March 2020 and by another 0.75 percentage point on 7 May. The two-week repo rate is currently set at 0.25%, the Lombard rate at 1.00% and the discount rate at 0.05%.