The Monetary Council of the National Bank of Hungary (NBH) has kept the central bank’s base rate at 0.90 percent and the O/N deposit rate at -0.05 percent at a monthly policy meeting on Tuesday.
In a statement released after the meeting, the council noted the upside risk to inflation of strong domestic demand, contrasted with the downside risk of weakening external activity, but said “downside risks have strengthened” with regard to persistent inflation trends.
According to MTI, factors impacting the outlook for inflation include the spillover of disinflationary effects of a slowdown in Europe, changes in the monetary policies of the world’s leading central banks, the effect of the new Plus retail government security on savings, and the economic consequences of counter-cyclical fiscal policy.
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