Zoltan Arokszallasi of Erste Bank said core inflation was good, but food and fuel prices were a source of upward risk. Rates are likely to be cut only after inflationary risks subside and the government starts implementing structural reforms outlined in the Szell Kalman Plan, he added.
Gergely Suppan of TakarekBank noted that inflationary risks were all external, but still put the MNB base rate at 6.00% at the end of 2011.
Budapest Alapkezelo’s Daniel Bebesy said the MNB’s fresh Quarterly Inflation Report, due out Wednesday, was expected to show inflation over the target in the horizon relevant for monetary policy.
The possible effects on domestic consumption of payouts of real yields on pension fund assets transferred to the state as well as of personal income tax changes are not known, and there is still uncertainty about the Szell Kalman Plan because of a lack detailed measures, he added.
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