have varied from 25 to 200 basis points above the central bank's target policy rate or related money market rates.
The central bank said the refinancing rate and Lombard rates
for all maturities were being raised from 50 per cent, placing them at their highest since February 1996.
Until mid-August 1991, the Bundesbank left the discount and lombard rates
unchanged, while the repo rate steadily edged up toward the lombard rate
of 9 percent.
The Austrian national bank lowers the discount and Lombard rates
by 0.5 percentage point each to 2.5 per cent and 4.75 per cent, respectively.
Following the Bundesbank's rate reduction, in mid-May, the Austrian discount and the Lombard rates
were lowered to 4 1/2 and 5 1/2 per cent, respectively.
Between February and July 1993, the discount and Lombard rates
have been reduced in several steps to 6 3/4 per cent and 8 1/4 per cent respectively (cf.
Moreover, it increased discount and lombard rates
on several occasions, introduced a flexible lombard rate at 1 percentage point above the call-money rate in the Spring of 1989, and raised this mark-up to 2 percentage points in December 1989.
On April 18, the Bundesbank announced that it would cut its discount and Lombard rates
, effectively lowering the range within which German money market rates fluctuate.
In addition, on August 24 the Bundesbank reduced both its discount and Lombard rates
50 basis points, to 3.5 percent and 5.5 percent respectively.
With monetary policy centred on the linkage of the schilling to the Deutschemark, both the discount and the Lombard rates
were raised in line with those in Germany in December.
When the council did lower the discount and Lombard rates
50 basis points to 6.25 percent and 7.25 percent respectively on September 9, the concurrent, smaller-than-expected reduction of 10 basis points to 6.70 percent in the Bundesbank's money market repurchase rate led to continued tightness in German money markets.
The increases in the discount and Lombard rates
in August (to 7 1/2 per cent and 9 1/4 per cent, respectively) were designed to emphasise the commitment to lowering inflation.