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MNB says has more room for monetary easing

Hungary's improving economic outlook, recovering market sentiment and the strong forint will give the central bank (MNB) enough wiggle room for further monetary easing, MNB deputy-governor Ferenc Karvalits told Reuters.

Hungary's higher-than-expected 5.9% inflation reading for March is no cause for concern as inflation is likely to come down close to the MNB's 3% target by year's end, Karvalits said.

As far as inflation and economic outlooks are concerned, there's no need for tighter monetary conditions, however, the MNB must remain cautious as long as investor sentiment is so brittle, he said. When asked about the possibility of MNB intervention in currency gains, Karvalits said the MNB normally refrains from intervention, but there may be an extraordinary scenario when it may be necessary.

The MNB's monetary council is scheduled to hold its next rate-setting meeting on April 26. (Világgazdaság)