Czech National Bank lowers interest rates – CZK finally weakens

Czech National Bank (CNB) used a whole arsenal against the strong currency. As the first came the announcement CNB decided to, first time in three years, lower the interest by a 0,25% to 3,5%. Immediately, the rate of exchange jumped up to 24,10 czk from 23,90czk/€.

Another punch to the Czech crown was delivered yesterday, when CNB announced there many be another lowering of interest until the end of the year, bringing further currency weakening.

The reason is exporters wouldn’t be able to export anything, if the crown continued strengthening. When the CZK got in July even under 23 czk/€, with the perspective of slowed state economics this was a logical solution.

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