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EMERGENCY MEASURES – Czech National Bank’s coronavirus stabilization measures (No. 882)

The Czech National Bank (“CNB”) has already responded to current economic development. As of 17th March 2020, the Board of CNB reduced the two-week repo rate to 1.75 %. It also decided to lower the Lombard rate to 2.75% and the discount rate to 0.75%. The Board of the CNB also announced further reduction of interest rates if the state’s economy requires it.

Another preventive action is that the Board of CNB has modified the rules for monetary operations to provide liquidity to banks. It also confirmed the readiness of CNB to respond to any excessive fluctuations in Czech crown exchange rate. Regarding the possibility of postponing the repayment of clients´ loans by banks, the decision to postpone the repayment of all types of loans is the responsibility of individual commercial banks. CNB does not intervene into banks' strategies and rules for granting, managing or recovering loans.

Finally, good news. According to CNB the banking sector can cope with the effects of even significantly adverse economic developments.

An overview of current interest rates can be found here.

publikováno 25.03.2020
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