Commerzbank: MNB rate cut an orchestrated surprise
Image by Jessica Fejos
The National Bank of Hungary’s (MNB) surprise move yesterday of sharply lowering inflation forecasts and cutting base rates for the first time since last summer’s easing cycle was effective in catching the market off guard, according to a press release issued by Commerzbank yesterday.
After signaling that any additional monetary easing would take place using unconventional tools, the MNB followed with a surprise cut yesterday to the base rate of 15 basis points to 1.2%.
“The central bank changed its signaling quite quickly, and then followed up with actual rate cuts even before the consensus had fully appreciated that rate cuts were coming – this will likely also boost the efficacy of the policy. But, crucially, the central bank averted falling seriously behind the curve,” the Commerzbank analysts said, adding that it was surprised to see the MNB react so quickly.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
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.