Market expects Hungary's central bank to slow monetary easing pace in March.

By bne IntelliNews March 24, 2014

The Monetary Council (MC) of Hungary’s central bank is expected to cut the base interest rate by 10bps to a new record low of 2.60% at its next rate setting meeting scheduled for March 25, the majority of analysts polled by portfolio.hu said. Although the analysts were fairly united about the size of the rate cut, some of them expect an on hold decision, believing that global uncertainties could prompt rate-setters to suspend the cuts.

The central bank cut on February 18 the base rate by 15bps to 2.70%. This was the eighteenth consecutive reduction and followed a similar reduction in January 2014. It came as a surprise for the market, which expected a 10bps cut. The decision was approved with the votes of seven of the rate setters. Two members expressed view that the current level of interest rates implies that the easing cycle has reached its bottom. According to them, this was evident from the volatility of the exchange rate, the steepness of the yield curve and rises in short-term yields.

The central bankers agreed that the March issue of its quarterly inflation report would be of key importance in terms of the future conduct of monetary policy. Furthermore, the possibility of ending or continuing the easing cycle would be clearly communicated in the issue.

Read in IntelliNews Pro
Get IntelliNews Pro

Related Articles

Hungary's electric sports aircraft maker expands production

Hungary's Magnus Aircraft is constructing a new manufacturing plant in southern Hungary near the regional Pecs-Pogany airport to meet rising demand for its unique aircraft and plans to finish ... more

Gyorgy Waberer to list logistics company BILK on Budapest bourse

Gyorgy Waberer, the former owner of haulage company Waberer, plans to list shares of Budapest logistics terminal BILK on the Budapest Stock Exchange in June, local media reported on May 28. “I ... more

Hungary reaches deal with Gazprom on 2019 gas deliveries

Hungary has reached an agreement with Russian gas giant Gazprom on the volume and price of next year's gas deliveries and negotiations have begun on gas deliveries for 2020, Foreign Minister Peter ... more

Most Read

  1. STOLYPIN: Putin builds a Presidential Administration fit for stagnation
    5 days ago
  2. Denmark remains last to approve Russia's Nord Stream 2, Sweden finds "no reason" to ban the pipeline
    7 days ago
  3. Irish tech titan lines up stake in Slovak AI firm
    1 day ago
  4. Erdogan raises a white flag in the lira crisis
    22 days ago
  5. COMMENT: Russia and Ukraine: More similar than either wants to admit
    4 months ago
  1. KRUK REPORT: The unbearable lightness of being alive
    20 days ago
  2. Sberbank oil analyst Alex Fak fired for being openly critical of state-owned gas giant Gazprom
    28 days ago
  3. STOLYPIN: Putin builds a Presidential Administration fit for stagnation
    5 days ago
  4. Gazprom insider pipeline deals for Putin cronies worth $93bn, analysts claim
    29 days ago
  5. COMMENT: Russia’s oil giant Rosneft just crossed one of China’s red lines in Vietnam
    15 days ago

Selected articles from our premium news/views wire IntelliNews Pro

Login to IntelliNews Pro
Get IntelliNews Pro

Reports

Dismiss