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Czech central bank says foreign exchange intervention to continue

Xinhua, February 14, 2017 Adjust font size:

The Czech National Bank (CNB) will continue to carry out foreign exchange intervention till at least the end of the first quarter of 2017, CNB governor Jiri Rusnok announced Monday.

The governor made the remarks at a press conference after meeting with Czech Prime Minister Bohuslav Sobotka the same day.

The Board of CNB during a meeting on Feb. 2 decided unanimously to keep interest rates unchanged at technical zero.

The Bank Board decided to continue using the exchange rate as an additional instrument for easing the monetary conditions.

It confirmed the CNB's commitment to intervene on the foreign exchange market if needed to weaken the koruna against the euro so that the exchange rate of the koruna is kept close to 27 crowns to one euro.

CNB Bank Board in early February reiterated that the probable date of completion of foreign exchange interventions is at half of 2017. It also stated that it will not discontinue the use of the exchange rate as a monetary policy instrument before the second quarter of 2017.

Rusnok said on Monday that nothing will change the fact that the CNB's commitment to continue the intervention till at least the end of the first quarter of 2017.

Czech Prime Minister Sobotka on Monday said he was convinced that the exchange rate intervention was in favor of the stability of the financial sector and the population of the country.

CNB launched the foreign exchange intervention in November 2013 in order to weaken the crown and keep the exchange rate close to 27 crowns per euro. Endit