PRAGUE (AP) — The Czech Republic’s central bank on Thursday cut its key interest rate for the fourth straight time as inflation dropped and the economy showed signs of recovery.
The cut by a half-percentage point brought the interest rate down to 5.25%. The move was expected by analysts.
The bank started to trim borrowing costs by a quarter-point on Dec. 21, which marked the first cut since June 22, 2022. It continued with a cut by a half-percentage point on Feb. 8 and went on by another half-percentage cut on March 20.
Inflation declined to 10.7% in 2023 from 15.1% in 2022, according to the Czech Statistics Office, and dropped to 2.0% year-on-year in February, which equals the bank’s target, and remained unchanged at the same level in March.
The Czech economy was up by 0.4% year-on-year in the first quarter of 2024, and increased by 0.5% compared with the last three months of the previous year, the preliminary figures released by Statistics Office indicated on Tuesday.
That came after the Czech economy contracted by 0.2% in the last three months of 2023 compared with a year earlier.
The Czech bank’s decision comes as central banks around the world, including the U.S. Federal Reserve, are trying to judge whether toxic inflation has been tamed to the point that they can start cutting rates.
The European Central Bank left its key rate benchmarks unchanged at a record high of 4% in April, but signaled it could cut interest rates at its next meeting in June.
But the U.S. Federal Reserve emphasized earlier this week that inflation has remained stubbornly high in recent months and said it doesn’t plan to cut interest rates until it has “greater confidence” that price increases are slowing sustainably to its 2% target.
FILE - A woman walks outside the Czech central bank in Prague, Czech Republic, on Nov. 2, 2023. On Thursday May 2, 2024, the Czech Republic's central bank cut its key interest rate for the fourth straight time amid falling inflation and signs of the economy's recovery. The cut by a half-percentage point brought the interest rate down to 5.25%. (AP Photo/Petr David Josek, File)
FILE - People stand outside the Czech central bank in Prague, Czech Republic, on Nov. 2, 2023. On Thursday May 2, 2024, the Czech Republic's central bank cut its key interest rate for the fourth straight time amid falling inflation and signs of the economy's recovery. The cut by a half-percentage point brought the interest rate down to 5.25%. (AP Photo/Petr David Josek, File)
KYIV, Ukraine (AP) — A massive Ukrainian drone attack on Crimea early Friday caused power cutoffs in the city of Sevastopol and set a refinery ablaze in southern Russia, Russian authorities said.
The drone raids marked Kyiv's attempt to strike back during Moscow's offensive in northeastern Ukraine, which has added to the pressure on outnumbered and outgunned Ukrainian forces who are waiting for delayed deliveries of crucial weapons and ammunition from Western partners.
The Russian Defense Ministry said air defenses downed 51 Ukrainian drones over Crimea, another 44 over the Krasnodar region and six over the Belgorod region. It said Russian warplanes and patrol boats also destroyed six sea drones in the Black Sea.
Mikhail Razvozhayev, the governor of Sevastopol, which is the main base for Russia's Black Sea Fleet, said the drone attack damaged the city’s power plant. He said it could take a day to fully restore energy supplies and warned residents that power would be cut to parts of the city.
“Communal services are doing their best to restore the power system as quickly as possible,” he said in a statement.
Razvozhayev also announced that schools in the city would be closed temporarily.
Earlier Ukrainian attacks damaged aircraft and a fuel storage facility at Belbek air base near Sevastopol, according to satellite images released by Maxar Technologies.
In the Krasnodar region, the authorities said a drone attack early Friday caused a fire at an oil refinery in Tuapse which was later contained. There were no casualties.
Ukraine has repeatedly targeted refineries and other energy facilities deep inside Russia, causing significant damage.
Ukrainian drones also attacked Novorossiysk, a major Black Sea port. The Krasnodar region’s governor, Veniamin Kondratyev, said fragments of downed drones caused several fires but there were no casualties.
Belgorov Gov. Vyacheslav Gladkov said a Ukrainian drone struck a vehicle, killing a woman and her 4-year-old child. Another attack set a fuel tank ablaze at a gas station in the region, he said.
Meanwhile, Ukrainian troops were fighting to halt Russian advances in the northeastern Kharkiv region that began late last week.
The town of Vovchansk, located just 5 kilometers (3 miles) from the Russian border, has been a hot spot in the fighting in recent days. Ukrainian authorities have evacuated some 8,000 civilians from the town. The Russian army’s usual tactic is to reduce towns and villages to ruins with aerial strikes before its units move in.
Russia has also been testing defenses at other points along the roughly 1,000-kilometer (620-mile) front line snaking from north to south through eastern Ukraine. That line has barely changed over the past 18 months in what became a war of attrition. Recent Russian attacks have come in the eastern Donetsk region, as well as the Chernihiv and Sumy regions in the north and in the southern Zaporizhzhia region. The apparent aim is to stretch depleted Ukrainian resources and exploit weaknesses.
Follow AP's coverage at https://apnews.com/hub/russia-ukraine
This image released by Maxar Technologies shows a closer view of a destroyed MiG 31 fighter aircraft at Belbek air base, near Sevastopol, in Crimea, Thursday, May 16, 2024. (Satellite image ©2024 Maxar Technologies via AP)
This image released by Maxar Technologies shows an overview of Belbek air base, near Sevastopol, in Crimea, Thursday, May 16, 2024. (Satellite image ©2024 Maxar Technologies via AP)
This image released by Maxar Technologies shows an overview of destroyed MiG 31 fighter aircraft and fuel storage facility at Belbek air base, near Sevastopol, in Crimea, Thursday, May 16, 2024. (Satellite image ©2024 Maxar Technologies via AP)
This image released by Maxar Technologies shows an overview of a destroyed SU 27 fighter aircraft in revetment at Belbek air base, near Sevastopol, in Crimea, Thursday, May 16, 2024. (Satellite image ©2024 Maxar Technologies via AP)
This image released by Maxar Technologies shows a damaged plane, likely a MiG 31 fighter aircraft, at Belbek air base, near Sevastopol, in Crimea, Thursday, May 16, 2024. (Satellite image ©2024 Maxar Technologies via AP)
