Czech Central Bank Cuts Rate to Record Low on Austerity
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The Czech central bank cut its main interest rate to a record low, the first change in two years, after faltering domestic demand sparked an economic recession and the government’s borrowing costs sank to the lowest ever.
The Prague-based Ceska Narodni Banka lowered the two-week repurchase rate by a quarter-point to 0.5 percent today, in line with forecasts of 20 out of 24 analysts in a Bloomberg survey. The reduction deepened the discount to the European Central Bank’s benchmark rate to half a percentage point. The move was influenced by government plans for more measures to cut the budget deficit, Governor Miroslav Singer told reporters.