Hungarian rate-setters raised the central bank base rate by 100bp
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Hungarian rate-setters raised the central bank base rate by 100 basis points to 4.40 percent at a monthly policy meeting on Tuesday.
The members of the Monetary Council also decided to raise the O/N deposit rate by 100 basis points to 4.40 percent and the O/N and one-week collateralised loan rates by 100 basis points to 7.40 percent.
The O/N deposit rate and the collateralised loan rate mark the bottom and the top, respectively, of the central bank’s “interest rate corridor”. The base rate is paid on mandatory reserves.
In a statement released after the meeting, the Council said the Russia-Ukraine war has “posed a much higher risk than usual” to the outlook for inflation.
The increase in inflation risks warrants a further tightening of monetary conditions.
Consequently, the Monetary Council deems it necessary to continue the general tightening of monetary conditions and to continue the base rate tightening cycle by a larger increment than before, it added.
All the componentry that are the Major Core Mechanics – of the Financial & Economic functioning, of the Hungarian Economy, continue to TREND downwards.
This “Trending” continues to display the mounting pressure on this present Government, that could see the Economy of Hungary – being questioned, as to its ability to survive – and not TREND – into a greater serious stage of Depression.
Interest Rate – subject of this article – continue to Rise.
The present Government attempting – “Mea Cupa” with the European Union – Brussels – the level of financial request, to the maximum, that witnesses the present Hungarian Government – requesting the FULL – allocated loan facility, under the Resilience & Recovery Facility.
This request – will amount to a delayed process of DEEP evaluation by the European Union, that may NOT go in the direction nor the requested amount of Funding, being “punted on” – by the present Hungarian Government.
REMEMBER – the European Union – with Hungary under a LARGE Microscope – in the way & process that Hungary has in recent years – disbursed and used European Union Funding – to expect the European Union to meet these latest requests by the Government of Hungary – must be in a category expressed as – Doubtful.
The “que” – in front of Hungary – will be given preferential treatment – that numbers of member countries of the European Union would agree is – Rightful.