Interest rate cut would not favour banks, Central Bank Governor says

It would not make sense for Slovakia to immediately follow the coordinated interest rate cut undertaken by the U.S. Federal Reserve, the European Central Bank and four other central banks on October 8.

It would not make sense for Slovakia to immediately follow the coordinated interest rate cut undertaken by the U.S. Federal Reserve, the European Central Bank and four other central banks on October 8.

Ivan Šramko, governor of the National Bank of Slovakia (NBS), speaking at a press conference held by the Slovak Association of Corporate Finance Officers on October 9, said that the position of Slovakia's economy is different. Banks on ailing markets are grappling with scarcity of liquidity, which central banks are replenishing through various measures, but Slovakia is facing the opposite development, he said. The central bank is sterilising money, which means that Slovakia needs no extraordinary measures because it has plenty of liquidity available. An overly rapid reaction by the central bank would be to the detriment of banks.

Šramko, however, admitted that the central bank was going to deal with the interest rate cut. It will have to harmonize interest rates with the levels set by the European Central Bank (ECB) upon Slovakia's entry to the eurozone. The central bank sees no reason for an extraordinary decision of the NBS Bank Board in this respect but the board will certainly touch upon this issue at its regular sessions.

The key interest rate in Slovakia and, at the same time, the two-week sterilization rate, remains at 4.25 percent p.a. The ECB's key interest rate, which is simultaneously the key refinancing rate, dropped 50 basis points on October 8 to 3.75 percent. The ECB's decision to join the coordinated interest rate cut constituted a step that supports economic growth but increases inflationary pressures through reducing prices of funds. SITA

Compiled by Zuzana Vilikovská from press reports
The Slovak Spectator cannot vouch for the accuracy of the information presented in its Flash News postings.

Top stories

The future of safer abortion in Slovakia is still unknown.

News digest: Health minister ponders politically fraught abortion pill decision

Summer in Bratislava, the future of stores, and the general prosecutor objects to a sentencing decision.


17 h
Vrakuňa’s citizens presented apples washed in water with leaked toxins at the protest in 2016.

Chemical time bomb in Bratislava’s Vrakuňa keeps ticking

The state is failing to solve leaking chemical waste dump.


31. may
Jupiter (centre) and its Galilean moons: from left Ganymede, Io, Europa and Callisto. Juice with deployed antennas and arrays is in the bottom right.

From Košice to Ganymede: Slovak engineers are leaving their mark in space

Slovaks are active participants in two ongoing space missions.


20. may
Devin Castle

Top 10 events in Bratislava for foreigners

Tips for the top 10 events in the capital between June 8 and June 18, plus temporary exhibitions, classical music and highlights of the year.


8. jun
SkryťClose ad