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Hungary. Central bank governor: Hungary is close to crisis, price caps should be withdrawn immediately

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The head of the Hungarian National Bank (MNB), Gyorgy Matolcsy, warned during a meeting of the parliamentary committee for economic affairs that Hungary was among the top European countries at risk of crisis. According to Telex.hu, Matolcsy criticized the government of Viktor Orban.

President of the National Bank Hungarian On Monday, Gyorgy Matolcsy presented the Hungarian Central Bank’s 2021 report to the committee. Fragments of his statements were published on social media by the parliamentary committees participating in the meeting and confirmed by sources of Telex.hu.

The president of the MNB was to state that Hungary is “the fourth-fifth most vulnerable country in the world” and “the fourth from the last in the European Union in terms of productivity,” said Bence Tordai of the Dialogue for Hungary party.

According to his account, Matolcsy also stated that Hungary “has second after Romania the highest twin deficit in the EU, and next year inflation will be the highest among the member states and will amount to about 15-18 percent”. The head of the central bank was to state that inflation is not the result of sanctions or war, because it has been increasing since the summer of 2021 due to the increase energy prices.

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According to the Telex.hu portal, Matolcsy criticized the government of Viktor Orban, claiming that in many aspects economic problems are the result of his decisions, and that there is a gap between the central bank and the government’s economic policy. According to him, “after 2010 we did not make the right decisions”, while after 2021 the government, according to the president of the bank, makes the wrong decisions.

The head of the Hungarian National Bank criticizes Orban

Matolcsy criticized the government’s crisis management strategy as “flawed”. According to him, price caps on food and fuel should be withdrawn immediately.

“Hungary is the only country that uses more petrol and diesel than before the energy crisis,” the MNB president was quoted as saying by Telex.hu. He called the “absurd” cap on fuel prices that encouraged people to consume more despite the economic crisis.


“We have told the government several times,” the central bank president was quoted by Reuters, which obtained the minutes of the commission’s meeting. Matolcsy added that the price caps had prompted retailers to increase the prices of other products not covered by them, adding 3 to 4 percent. to inflation.

High inflation in Hungary

Finance Minister Mihaly Varga reacted to Matolcsy’s speech on Monday. – The president of the Hungarian central bank is right to point to economic problems – admitted the politician. – But the problem of high energy prices is not only in Hungary, because they are driving countries’ economies towards recession throughout Europe – he added.

According to the latest figures from Hungary’s Central Statistical Office (KSH), inflation stood at 21.1 percent in October and Hungary’s economic growth slowed to 4 percent in the third quarter.

Main photo source: Shutterstock

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