Listen to the audio version of this article (generated by AI).
Listen to the audio version of this article (generated by AI).
The Council also lowered both ends of the symmetric interest rate corridor by 25 basis points, bringing the overnight deposit rate to 4.5% and the overnight collateralized lending rate to 6.5%.
In a statement released after the meeting, the Council said inflation developments had been below the baseline scenario projected in June, while the risk premium on domestic assets had remained stable.
“These factors have preserved the Monetary Council’s room to maneuver,” the Council said.
July inflation slowed to 1.2%, below both market expectations and the forecast in the central bank’s June Inflation Report. The Council said CPI was expected to remain below the 3% target for the rest of 2026 and throughout 2027 before returning to target in the first half of 2028.
Equilor said the decision was in line with expectations and noted that the central bank had not committed itself in advance to further rate cuts.
According to the investment services provider, the MNB will assess the next steps in monetary policy based on the forecasts contained in the September Inflation Report.
The Monetary Council reiterated that it remained committed to sustainably achieving the inflation target and would continue to assess the inflation outlook, global developments and changes in Hungary’s risk premium.
Equilor also noted that positive real interest rates, together with stability in financial markets, particularly the foreign exchange market, were helping to anchor inflation expectations and support price stability.
“Looking ahead, Hungary’s risk assessment will be primarily influenced by expectations regarding the fiscal path and the adoption of the euro, as well as the external market environment,” the Council said.
Equilor said the euro-forint exchange rate had moved below its 30-day moving average, which now represents short-term resistance at 362.66.
The next significant support level stands at 360.57, followed by the 50-day moving average at 359.51.
Technical indicators are currently pointing lower, Equilor said, adding that the exchange rate could eventually break below the 50-day moving average as well.
Producing journalism that is worthy of the name is a costly business. For over 30 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.
