The decision, made by the bank’s seven-member board, was in line with expectations from most domestic analysts.

The previous rate reduction occurred in February, also by 0.25 percentage points. With this latest move, the base interest rate has reached its lowest level in three and a half years. Some analysts anticipate that rates could fall even further by the end of 2025.

The rate cut comes as inflation continues to ease following several years of economic turbulence. According to the Czech Statistical Office, consumer prices decreased by 0.1% month-on-month in April and rose only 1.8% year-on-year—falling below the CNB’s long-term inflation target of 2%. This decline in inflation was steeper than most analysts had predicted, with falling energy and fuel prices contributing significantly to the trend.

Author: CzechTrade Toronto
Source: HN