China is not behind massive purchases of Hungarian debt, says Portfolio.hu

MNB

It is certainly not the Chinese or the Hungarian National Bank that have been aggressively buying Hungarian government securities both on the secondary market and at auctions, deputy CEO of the government debt management agency ÁKK told Portfolio.hu.

Borbély said at last Thursday’s bond auctions, when demand for Hungarian debt was also massive, the bonds were not scooped up by a single mammoth buyer, as the ÁKK received several smaller bids, which signals the wide interest for Hungarian government bonds (HGB). 

If the central bank decided to buy HGBs it would do it in a transparent fashion and there would be no need for "guessing" on the market, he added.

Borbély said that in his view the rate cut expectations have intensified over the past few days over the weaker-than-expected Q2 GDP data and the subsequent deterioration in the growth outlook, as well as low inflation. According to the investors’ logic such an environment creates room for the central bank to lower its 6% base rate, he added.

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