The Monetary Council of the National Bank of Hungary is going to keep the central bank O/N deposit rate at -0.05 percent and the base rate at 0.9 percent. Both inflation and economic growth are expected to be higher this year than originally expected. The council pointed out that risks to inflation had become asymmetric as downside risks have increased due to the slowdown in Europe and a loosening of monetary policy by big central banks.
“In the Monetary Council’s assessment, previously symmetric risks to inflation became asymmetric in the last quarter. The downside inflation risks have strengthened further, reflecting the effects of the slowdown in European economic activity. Due to the measures taken by global leading central banks, the external monetary policy environment has become looser,” according to the council’s statement.
