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Czech central bank keeps rates steady, pauses policy tightening

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Czech central bank keeps rates steady, pauses policy tightening

The central bank of the Czech Republic decided to maintain its key rates, taking a break from a policy tightening which saw two rate hikes since August.

The board of the Ceská národní banka kept its two-week repo rate at 0.50%, the discount rate at 0.05% and the Lombard rate at 1%.

Annual inflation fell to 2.6% in November from 2.9% in October. Central bankers have used an assortment of tools, which include exchange-rate appreciation and rate hikes, to keep price growth within target, Bloomberg News said. The economy expanded by 5.0% year over year in the third quarter, and wages rose even faster, while unemployment fell to all-time lows, supporting inflationary pressures, Reuters said.

There was little movement in the Czech koruna, the best-performing currency in 2017, after the announcement. It was trading at 25.71 per euro, near the weakest in two months.