Czech central bank starts targeting exchange rate
The board of the Czech National Bank today decided to start intervening in the foreign exchange (forex) market to weaken the national currency, the koruna, after 12 months with interest rates at the effective zero lower bound.
In a brief statement, the central bank said it would intervene to get the exchange rate down to "close to CZK27" to the euro, compared with 25.80 before the announcement was made. Minutes after the announcement, the exchange rate shot up to almost CZK26.68.
The decision
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