National Bank of Hungary deputy governor Julia Király was the only member of the central bank's Monetary Council to vote for a rate rise at a meeting on September 20, the condensed minutes of the meeting published Wednesday show.
Király voted to raise the MNB's key rate by 25bp.
Governor Andras Simor, deputy governor Ferenc Karvalits and Monetary Council members Andrea Bártfai-Mager, János Cinkotai, Ferenc Gerhardt and György Kocziszky all voted to keep the base rate on hold at 6.00%.
Most of the members agreed that the inflation outlook would provide room to ease monetary conditions, judging from real economic developments, but the sharp deterioration in global risk perceptions prevented this from materializing, according to the minutes. Several members also noted that the temporary inflationary effect of increased excise duties limited the room for maneuver of monetary policy.
One member -- most certainly Király -- argued that the base rate should be raised "to signal the stance of monetary policy...taking into account both the inflation outlook and financial stability risks".
Other members said it would be unjustified to raise the base rate, due to the Bank's credibility and its commitment to stability as well as its program to sell foreign currency by tender to be announced soon.
Simor said at press conference after the meeting that the MNB would launch weekly euro tenders for banks to ensure they have sufficient liquidity for an early forex mortgage repayment scheme.
The government scheme allows early repayment, in full, of foreign currency-denominated mortgages at a discounted exchange rate. Borrowers have until the end of 2011 to avail of the opportunity.