MNB weekly QE purchases stand at HUF 53 bln


MNB headquarters in Budapest.

The National Bank of Hungary (MNB) bought HUF 53 billion of securities in the framework of a quantitative easing program in the week ended August 22, Hungarian news agency MTI reports, citing data published by the central bank.

Weekly purchase volume has averaged close to HUF 55 bln for nine weeks, falling from around HUF 60 bln in the period since early February.

The latest weekly QE data show the central bank bought HUF 25.3 bln of government securities at auction and HUF 27.7 bln outside of auction. The bonds included HUF 36.3 bln of government securities with terms under 10 years.

The total purchases made in the framework of the QE program reached HUF 2.953 trillion on August 22, including about HUF 2.878 tln of government securities and HUF 75.3 bln of bonds from other issuers with government guarantees, such as the Hungarian Development Bank (MFB) and Magyar Eximbank.

The central bank's Monetary Council performed a revision on the program as assets approached the HUF 2 tln mark at a monthly policy meeting in April, but set no limit for total stock. The next revision will be performed when stocks reach HUF 3 tln, the council said. In the meantime, the policymakers said the MNB would continue to use the QE program "by maintaining a lasting presence in the market, taking a flexible approach to changing the structure of weekly securities purchases, to the extent and for the time necessary".

MNB launched the QE program in the spring of 2020 "to prevent monetary policy transmission and manage economic and financial risks arising from the coronavirus pandemic". The program has since been expanded to include securities with maturities under 10 years, while a limit on the volume of securities series the MNB may purchase has been scrapped.

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