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.