Central bank continues to cut base rate to 1.05%

EU

Rate-setters of the National Bank of Hungary’s Monetary Policy Council today decided to cut the central bank’s key rate by 15 bps to 1.05%, as an extension of the 15 bps cut made two weeks ago, according to reports.

The central bank cut the base rate two weeks ago for the first time since last summer and signaled possible further easing, Hungarian news agency MTI reported. The cut today happened as market analysts expected. 

“Interest rate cuts will continue as long as monetary conditions become consistent with the sustainable achievement of the inflation target,” the Council said in a statement after the meeting, according to MTI.

The bank also decided to lower the top of the interest corridor, a band around the base rate that prevents extreme fluctuations of interbank rates, bringing the O/N collateralized loan rate to 1.30% while keeping the O/N central bank deposit rate at -0.05%, MTI added.

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