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MNB Lowers 2024 Inflation Forecast

Analysis

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The National Bank of Hungary (MNB) lowered its 2024 inflation forecast because of more favorable than expected spring data and declining global crude prices, the central bank said in a quarterly report released on its website.

Critical data from the MNB's fresh Inflation Report published on Tuesday showed the forecast for this year's average annual inflation was lowered to 3-4.5% from 3.5%-5% in the previous report published in March. 

In a presentation of the report, András Balatoni, an MNB director, said vehicle fuel and market energy prices, as well as the prices of unprocessed food, were behind the 0.5 of a percentage point change in the forecast. The MNB noted that global crude prices in dollars had fallen "substantially" from April to May, while European gas and electricity prices were also lower. 

It said that subdued changes in food prices in recent months had been supported by year-on-year declines in global commodity prices as well as government measures generating stronger competition. Annual inflation of unprocessed food products is projected at around 0.3% for 2024, it added.

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