Central banker envisions further hikes to forint base rate

Analysis

Hungary's central bank may be forced to raise interest rates due to risks to its inflation target, deputy governor Ferenc Karvalits told Reuters.

“Recent developments in commodity prices might exert further pressure on domestic inflation. We cannot rule out that we will need further (monetary) tightening,” he told Reuters.

“However, everybody should keep in mind that substantial tightening has happened already and its impacts unfold with a time lag,” he said, referring to three rate hikes totaling 100 basis points in the past three months which have brought the key base rate to 8.5%.

Karvalits was speaking after May twelve-month inflation, published on Wednesday morning, came to 7.0%, rising from 6.6% in April, up from analysts' expectation for no change or a minimal rise. Karvalits said that the figure slightly exceeded not the bank's expectations too.

The National Bank of Hungary (MNB) will hold its next rate-setting meeting on June 23. (MTI – Econews)

ADVERTISEMENT

Farm, food industry confidence improves slightly in Q2 Analysis

Farm, food industry confidence improves slightly in Q2

Meeting called to address Pegasus spyware lacks quorum  Parliament

Meeting called to address Pegasus spyware lacks quorum 

Skanska commercial dev unit names new EVP of operations Hung... Appointments

Skanska commercial dev unit names new EVP of operations Hung...

Zsa Zsa Gabor's ashes buried in Budapest City

Zsa Zsa Gabor's ashes buried in Budapest

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.