Hungarian National Bank decided about base rate, regards price stability primary task

The Monetary Council of the National Bank of Hungary (NBH) decided to leave the central bank base rate unchanged at 6.50pc at a monthly policy meeting on Tuesday.

Base rate remains

The Council also left the O/N deposit rate at 5.50pc and the O/N collateralised loan rate at 7.50pc. The rates mark the ends of the central bank’s symmetric interest rate corridor.

In a statement released after the meeting, the Council affirmed its commitment to achieving the inflation target in a sustainable manner and pointed to the need for a “careful and patient” approach to monetary policy amid risks to the inflation environment and trade policy and geopolitical tensions.

“Maintaining tight monetary conditions is warranted,” the policy makers said.

At a press conference after the meeting, central bank governor Mihaly Varga said inflation was slowing further in April and was expected to approach the upper end of the NBH‘s 3pc +/-1pp tolerance band in the coming months. He also said inflation risks had strengthened because of the timing and contrasting effects of tariffs announcements, while volatility on international financial markets had grown and risk aversion on emerging markets had increased.