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MNB raises 1-week depo rate by 40 bp to 2.9%

MNB

Photo by Adriana Iacob/Shutterstock.com

The National Bank of Hungary (MNB) announced a rate of 2.9% for its one-week deposit facility ahead of a tender on Thursday, 80 bp over the base rate, according to a report by news agency MTI.

The central bank raised the one-week depo rate by 40 bp from the tender a week earlier, days after the forint slipped past 372 to the euro, a new historical low.

At the previous weekly tender, the one-week depo rate was raised to 40 bp over the base rate.

The one-week depo rate has moved in tandem with the base rate since late June, but the central bank's Monetary Council said at a monthly policy meeting in November that MNB "must be ready to set the interest rate on the one-week deposit above the base rate", allowing it to respond to a recent increase in short-term risks in financial and commodity markets "quickly and flexibly".

Policymakers raised the base rate by 30 bp to 2.1% at the November meeting, after CPI spiked at 6.5% in October.

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