IMF: CEE Central Banks Should Maintain Tight Monetary Policy
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Central Europe's central banks should maintain a tight monetary stance for a "considerable time" to ensure inflation is kept in check and be ready to raise interest rates again if needed, a senior International Monetary Fund official said, according to news wire Reuters.
With inflation in the Central European region declining from double digits, some central banks there have been easing policy, pressuring their currencies as rate differentials with the eurozone narrow and markets price in the prospect of higher U.S. rates for longer, the report notes.
Hungary has cut rates by a combined 500 basis points since May, though its 13% base rate is still the highest in the EU, and Poland (which held a parliamentary election yesterday) by 100 basis points.
IMF forecasts released earlier this month estimate average 2024 inflation at 6.4% in Poland, and 6.6% in Hungary.
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