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National Bank of Hungary keeps base lending rate at 0.9%

The Monetary Policy Council (MPC) of the National Bank of Hungary kept the base lending rate on hold at 0.9% during a rate-setting policy meeting today.

The decision of the council was expected as the MPC clearly signaled the end of its easing cycle in May.

The Council also left the interest rate corridor, a band around the base rate that prevents extreme fluctuations of interbank rates, unchanged at the meeting. The O/N collateralized loan rate, the top of the range, stands at 1.15%, while the O/N central bank deposit rate is -0.05%, Hungarian news agency MTI reported.

Rate-setters voiced a commitment to keeping the central bank’s base rate on hold, and suggested they could still decide to apply so-called “unconventional” monetary policy tools in the future if needed, according to the minutes from their June 21 meeting.

There was apparently no need for the central bank to change course, as no macro data or financial market development has altered the big picture in the past weeks, MTI reported.