Hungary’s Magyar Nemzeti Bank Cuts Interest rate for 14th Straight Time
September 24, 2013
A statement from Hungarian monetary officials announced a 20-basis point cut of the two-week deposit rate to a record low of 3.60%. A similar reduction had been made in August, and there was a streak of twelve monthly cuts of 25 basis points each starting in August 2012. Core inflation in Hungary is historically low, and because of a disinflationary real economic environment characterized by excess capacity points to continuing muted inflation. External debt is better contained, and the accommodative monetary policy environment in the rest of the world is expected to shelter the forint as a series of cautious cuts in Hungary’s central bank rate continues. It seems unlikely, however, that the policy rate declines beyond 3.0%.
Copyright 2013, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Central Bank of Hungary
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