Inflation accelerated in Hungary, so the forint began to strengthen

Hungary’s annual consumer price index was 4.1 percent in July, the Central Statistical Office (KSH) said on Thursday. As a result, the Hungarian National Bank (MNB) is not expected to continue its base rate cut programme, so the forint strengthened.

According to portfolio.hu, experts do not expect a further base rate cut from the MNB, so the forint strengthened from almost 400/EUR to 396 today.

Month on month, consumer prices were up an average of 0.7 percent, with vehicle fuel prices rising by 3.8 percent. Food prices rose by 2.7 percent in July. Household energy prices fell by 4.5 percent. Gas prices were 9.3 percent lower and electricity prices declined by 2.1 percent. Consumer durable prices edged down 0.5 percent.

Commenting on the data, Márton Nagy, the national economy minister, said the government’s economic policy measures had proven effective in reining in inflation.