50-Basis Point Central Bank Rate Hike in Hungary Beats Forecasts

January 25, 2022

The National Bank of Hungary unexpectedly stepped up its pace of interest rate normalization this month, lifting the base rate by a half percentage point to 2.9%, a 97-month high. This was the eighth consecutive monthly increase. From a starting base rate level of 0.6%, there had previously been two increases of 15 basis points and five increases of 30 basis points. CPI inflation has risen in Hungary from 2.7% a year ago to 7.4% as of December, when the pace failed to turn downward as officials had been hoping such would. Meanwhile, economic recovery in Hungary has been proceeding robustly and has now fully reversed the pandemic-related contraction.

Copyright 2022, Larry Greenberg. All rights reserved. No secondary distribution without express permission.



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