The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Banking

MC left base rate unchanged at Nov 20 sitting with 7-to-5 vote.

MC left base rate unchanged at Nov 20 sitting with 7-to-5 vote. The Monetary Council (MC) of the National Bank of Hungary (NBH) discussed only two options at its Nov 20 sitting - “on hold” and 25bps hike – and the decision was taken with 7-to-5 majority, the minutes from the meeting revealed. The outcome is fully in line with previous reports and considering that the absent member is largely perceived as a “hawk” the vote shows increasingly divided council. Proponents of unchanged base rate argued that the decline in domestic demand could have stronger disinflationary impact than the one assumed by the central projection of the November Inflation Report. We recall that the latter envisages headline inflation to slow down to 4.1% in 2008 and the core index to 4% (NBH’s price stability target is defined as 3% inflation in the mid-term). The “doves” stressed that estimates in NBH’s forecasting models used sample period over which real wages had not fallen, while exactly that was the case in the mid-term and thus the demand contraction impact might be underestimated. Furthermore, the majority of MC members deem that “wait-and see” approach was necessitated as the full impact of the hitherto tightening has not been revealed, while international environment remains benign.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree