Rate-setters of the National Bank of Hungary left the base rate unchanged at 0.90 percent and the central bank O/N deposit rate at -0.05 percent at a regular meeting on Tuesday.
The Monetary Council has not changed the base rate since May 2016, though it has tweaked monetary policy on a quarterly basis, coinciding with the publication of the central bank’s Inflation Report.
In a statement issued after the meeting, the Council said it would continue to decide on adjustments to monetary policy on a quarterly basis, saying it would carry out a “comprehensive assessment of macroeconomic developments” in the next Inflation Report, due to be published when the rate-setters meet in March.
The Council reiterated that it expects CPI to “return to the [+/- 1pp] tolerance band by the end of the first quarter of 2020, and to stabilise at the 3 percent inflation target in the second half of the forecast horizon”.
The Council said sentiment on global markets had “rather deteriorated” since the last policy meeting, citing the coronavirus outbreak as a reason.
The Council noted a slowdown in Hungary‘s growth rate, but said the economy was expected to continue to expand at a clip of “at least two percentage points” over growth in the eurozone.