Rate-setters stand by position on monetary policy
The Monetary Council of the National Bank of Hungary (MNB) reiterated its position to keep the central bankʼs key rate on hold at 0.90%, while remaining prepared to use unconventional policy tools if necessary, condensed minutes of the rate-settersʼ policy meeting in July show, news wire MTI reported Wednesday.
"If the assumptions underlying the [MNBʼs] projections held, maintaining the current level of the base rate and loose monetary conditions achieved through the change in monetary policy instruments for an extended period was consistent with the medium-term achievement of the inflation target and a corresponding degree of support to the economy," read the minutes.
"If inflation remained persistently below the target, the Council would stand ready to ease monetary conditions further using unconventional, targeted instruments," it added.
The Council earlier placed limits on the central bankʼs main instrument for sterilizing liquidity and introduced FX swaps as part of its "unconventional" monetary policy toolbox. The Council noted that a "watchful approach" to monetary policy is still justified because of uncertainty in the global financial environment.
The decision to keep the base rate on hold at the policy meeting on July 18 was unanimous. MNB Governor György Matolcsy was not present at the meeting.
The Councilʼs next policy meeting will take place on August 22.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 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.