- About the CNB
About the CNB
The CNB is the central bank of the Czech Republic, the supervisor of the Czech financial market and the Czech resolution authority. It is established under the Constitution of the Czech Republic and carries out its activities in compliance with Act No. 6/1993 Coll., on the Czech National Bank, as amended.
- Monetary policy
Monetary policy
The Czech National Bank endeavours to keep inflation low, stable and therefore predictable. It achieves its inflation target of 2% by setting interest rates and other monetary policy instruments. The Bank Board decides about them on the basis of a macroeconomic forecast and an assessment of its risks and uncertainties.
- Financial stability
Financial stability
The CNB sets macroprudential policy by identifying, monitoring and assessing risks to the stability of the financial system and, in order to prevent or mitigate these risks, contributes by means of its powers to the resilience of the financial system and the maintenance of financial stability.
- Supervision, regulation
Supervision, regulation
The CNB is the supervisory authority for the financial market in the Czech Republic. It lays down rules safeguarding the stability of the banking sector, the capital market, the insurance industry and the pension scheme industry. It regulates, supervises and, where appropriate, issues penalties for non-compliance with these rules.
- Banknotes and coins
Banknotes and coins
The CNB is the exclusive issuer of Czech banknotes and coins. Circulating banknotes and coins are intended for cash payments. Commemorative banknotes and coins are intended for collection and investment purposes and the CNB sells them through its contractual partners at prices different from their nominal values.
- Payments
Payments
The CNB contributes to preparing draft legislation in the area of payments and clearing between banks, foreign bank branches and credit unions. It promotes smooth and efficient payments and contributes to the safety, soundness, efficiency and development of payment systems.
- Financial markets
Financial markets
The CNB declares the exchange rate of the Czech koruna against other currencies in the form of foreign exchange market rates and in the form of exchange rates of other currencies. This section contains information about the foreign exchange market, the money market and the Treasury securities market, including regulations relating to the financial market in the Czech Republic.
- Resolution
Resolution
The CNB is the resolution authority for banks, credit unions and certain investment firms in the Czech Republic. Resolution means the restructuring of an institution to ensure the continuity of its critical functions, minimise the impacts on the economy and the financial system and restore the viability of all or part of that institution.
- Statistics
Statistics
The CNB in its area of competence compiles and publishes statistics, in particular monetary and financial statistics, balance of payments statistics, supervisory statistics, financial accounts statistics, general economic statistics and government finance statistics. The statistics are compiled in accordance with international standards and the standards of the European Union and the relevant requirements of the European supervisory authorities.
- Research
Research
The objective of the CNB‘s research is to provide outputs which help to expand the knowledge base needed for the core activities of the CNB and which are of a high standard on the international scale. The coordination and implementation of research is carried out by the Research Division, which is part of the Research and Statistics Department.
GDP comes in just below the CNB forecast in 2023 Q1
The CNB comments on the GDP figures for 2023 Q1
According to the Czech Statistical Office’s estimate released today, gross domestic product adjusted for price, seasonal and calendar effects dropped by 0.4% year on year in 2023 Q1. The Czech economy was flat quarter on quarter. The figures on economic activity were slightly lower than expected in the CNB’s spring forecast.
The released data confirm that the Czech economy is slowly coming out of a shallow recession which started in the second half of last year. The consumption of households, which are facing a deep decline in real income, decreased somewhat more markedly in Q1 than expected by the CNB. Fixed investment also recorded a deeper-than-forecasted decline. A further decrease in the contribution of change in inventories, which was even stronger than forecasted, is signalling that problems in global value chains are abating. Conversely, general government consumption grew faster than forecasted by the CNB. The contribution of net exports to economic growth was higher than forecasted, as year-on-year export growth remains strong at around 10%, while growth in imports slowed due to the downturn in domestic demand.
constant prices, seasonally adjusted
According to the CNB’s spring forecast, the Czech economy will expand slightly overall this year. The economic downturn recorded in the second half of 2022 will linger into the first half of this year, mainly due to a continued fall in household consumption expenditure. Czech households are still facing a deep decline in real income. This, together with negative sentiment and a higher saving rate, is reflected in a continued decline in their consumption. Fixed investment will return to growth this year, driven by a still good financial condition of firms and later also recovering external demand. In addition, export activity will be supported by the fading out of problems in supplies of materials and components for production. The downturn in domestic demand will cause import growth to lag well behind export growth this year. The contribution of net exports to economic growth will thus be strongly positive. According to the baseline scenario of the CNB’s spring macroeconomic forecast, economic activity will grow by around 3% in 2024. The scenario does not include the impacts of the government’s fiscal consolidation package introduced in May.
Petr Král, Executive Director, Monetary Department