Poll: Analysts see MNB cutting base rate on Tuesday

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Reuters-polled analysts expect the Hungarian central bank’s rate-setting Monetary Council to cut the current 2.10% base rate at a policy meeting scheduled for Tuesday. This would be the first rate cut since July, when the National Bank of Hungary (MNB) ended its easing cycle begun in August 2012. 

Reuters queried altogether 19 analysts in the framework of their survey between March 16-18. Nine analysts expect the central bank to lower its base rate by 10 basis points, eight analysts anticipate a base cut of 20 basis points, one of them expects a 15 basis point cut while another foresees a 30 basis point cut.

"After a long delay the MNB appears ready to resume its cutting cycle. This makes sense because of continuing deflation and the relative strength of the forint," analyst Daniel Hewitt from Barclays told Reuters. The analysts expect Hungaryʼs base rate to drop to 1.6% in the fourth quarter of 2015 before a rebound to 2.5% by the end of next year, Reuters added.

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