Czech central bank raises key interest rate to 0.5 percent

IndustriesAssociated Press

The Czech Republic's central bank has raised its key interest rate by a quarter point to 0.50 percent to rein in inflation amid a booming economy.

Thursday's move comes after a hike in August, to 0.25 percent. Besides strong growth, the country has the lowest unemployment rate in the EU and the inflation rate has reached 2.7 percent as of September, above the bank's target of 2 percent.

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In 2012, the bank had cut its key interest rate to 0.05 percent, the lowest since the country was formed in 1993 after the breakup of Czechoslovakia to help the struggling export-oriented economy.

The eurozone countries, including Germany, are the country's major trading partners but the Czech leaders have yet to set a date for adopting the euro.