CNB faces strategy dilemma when it comes to ending exchange rate floor
Vice governor: exit from euro floor will need to be decisive but well-communicated
The Czech National Bank (CNB) faces a significant dilemma when it finally decides to remove its exchange rate commitment, as it does not wish to cause alarm in the financial markets while at the same time will want to make a decisive break with the policy for the foreseeable future.
In November 2013, the CNB announced it would intervene in the foreign exchange market when necessary to ensure the koruna was "close to CZK27" against the euro. It publicly states it will maintain the policy until
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