The development of inflation, as well as GDP growth gives presently no reasons for change of interest rates of the National Bank of Slovakia (NBS). "The NBS Bank Board finds the current setting of monetary policy appropriate and it decided to keep key interest rates on hold," NBS Governor Ivan Sramko told during a break in the Tuesday's NBS Bank Board meeting. When deciding on setting of monetary policy, the Bank Board took in consideration chiefly the fact that cost factors, influenced by the global development of foodstuff prices, reflect the inflation development, added Mr. Sramko. Nevertheless, he admitted that the global growth of food and oil prices increases further inflation risks. "The risk of origin of secondary effects increases in the environment of global cost inflation pressures in the field of the development of oil and food prices and it will be necessary to reduce it from the viewpoint of monetary policy," said Mr. Sramko. None of the board members, present in the meeting filed a proposal to change interest rates.
The key interest rate in Slovakia remains unchanged for the eighth consecutive month. The NBS Bank Board decided on Tuesday to keep the two-week sterilization repo-rate at 4.25 percent p.a. The one-day sterilization repo rate is 2.25 percent p.a. and the one-day refinancing rate is 5.75 percent p.a. The central bank has kept interest rates on hold since April of this year. The central bank in May interrupted a two-month series of interest-rate cuts, when key interest rates decreased by 25 basis points in March and in April. In 2006, the NBS changed key interest rates four times. The last change last year came in September when the central bank increased key interest rates 25 basis points.
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