The Czech Repulbic still keeps its currency CZK

Published: 30.12.2019 Related countries:  India India

ČNB: Insufficient convergence prevents euro's adoption

 

 

 

 

Czech Republic’s intensive trade and ownership links with the euro

 

area and the resulting reduction in transaction costs and the

 

elimination of exchange rate risk remains one of the long-term most

 

important arguments for the Czech Republic's entry into the euro

 

area. This was stated by the Czech National Bank (ČNB) within its

 

analysis of the alignment of the Czech Republic's and the euro

 

area's economy. ČNB says that on the other hand risks remain, in

 

particular the still unfinished process of real economic convergence

 

of the Czech Republic to the euro area. The structural similarity of

 

the economies also remains lower. The non-alignment of financial

 

cycles with the euro area would also be a risk factor in the case of

 

euro’s adoption.