The Czech Republic’s central bank has raised its key interest rate to 1.50% for three quarters, in an effort to cushion rising inflation as the economy recovers from the coronavirus pandemic
Thursday’s move was the largest single rate hike since 1997 and the third increase in as many months.
Analysts had mostly predicted a half-point increase. The central bank sees high inflation as a major threat.
Inflation rose to 4.1% in August, well above the bank’s target of 2%. According to the country’s statistics office, the Czech economy posted a record growth of 8.1% year-on-year in the second quarter.
The last time the bank changed its rates was in August, when it raised the key interest rate by a quarter point to 0.75% to tackle inflation.