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Hungary interest rates. The National Bank of Hungary decided on another rate hike – comments

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The National Bank of Hungary (MNB) on Tuesday decided to raise the main interest rate by 30 basis points to 2.10 percent. Economists expected such a move.

The changes will take effect on Wednesday, November 17.

This is the sixth rate hike in Hungary in recent months. In October, the main interest rate rose by 15 basis points to 1.8 percent. The process of gradual raising of interest rates started in June this year.

National Bank of Hungary, BudapestShutterstock


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Interest rates in Hungary – comments

The decision did not surprise the economists. “No surprise in Hungary. The rates go up by 30 bp. Therefore, there is no pressing the brake pedal to the floor similar to what CNB (Czech National Bank – ed.) (And to a lesser extent NBP) did in recent months)” – they wrote on Twitter representatives of Bank Pekao.

MBank economists assessed Tuesday’s decision of the Hungarian bank as “moderate, calm rate hikes”. The graphic attached to the entry shows that among the countries of the region, the main interest rate is the highest in the Czech Republic. At the beginning of November, the local central bank decided to raise the main interest rate by 125 basis points to 2.75 percent.

It is not known what move the Monetary Policy Council (MPC) will decide on. Interest rates in Poland were raised in October and November and the benchmark interest rate rose by a total of 115 basis points to 1.25 percent.

The president of the National Bank of Poland and the chairman of the MPC in the reply sent to the Polish Press Agency indicated that a further increase in interest rates is now more likelybut it is difficult to predict whether this assessment will not change.

The next MPC decision-making meeting is scheduled for December 8, 2021.

Main photo source: Shutterstock

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