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Cbank ready to takes steps to meet 3% inflation target

Analysis

The National Bank of Hungary (MNB) is prepared to take steps to create monetary conditions that allow Hungary to achieve the bank’s 3% inflation target for the end of 2009, MNB deputy governor Júlia Király said at a conference on Friday.

Király said the MNB’s Monetary Council would consider rising global food and oil prices -- and their secondary effects -- as well as Hungary’s spring macroeconomic figures at its next rate-setting meeting on May 26. “Among the macroeconomic figures, the labor market figures are particularly noisy,” she said, explaining that it is difficult to extract a trend from the data. Király noted that the Monetary Council would discuss the bank’s new biannual inflation report at the meeting. She added there was now a consensus among analysts, investors and the MNB on the bank’s assessment.

Asked about Hungary’s government securities market, Király said it appears the situation on global money markets has calmed over the last month following a liquidity squeeze. Though market turbulence caused by the subprime mortgage crisis is not over, it appears a period of calm has begun on global markets, Király said. “That creates a better environment for deciding on monetary conditions.” (MTI-Econews)

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