MNB's Virág Suggests 75 bp Base Rate Cut
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National Bank of Hungary (MNB) deputy-governor Barnabás Virág suggested central bank policymakers would cut the base rate by 75 basis points at a monthly policy meeting in November, as they did in October, addressing a conference organized by the Official Monetary and Financial Institutions Forum (Omfif) in Budapest last week, according to novekedes.hu.
Strong disinflation and a reduction in Hungary's vulnerability allow the MNB to continue cutting the base rate in the coming months, Virág said, adding that policymakers would stick to a 75 basis points rate cut in November.
He said the base rate could fall under 11% by year-end and reach the single digits by February 2024, "based on the current data." The MNB's Monetary Council will hold its next policy meeting on Nov. 21.
Virág noted that Hungary's headline CPI had fallen into the single digits in October after peaking at 25.7% in January. CPI could be "around 7%" in December, he added.
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