NBH leaves key rate on hold and Cbank cuts inflation forecast to 0.4 pc for 2016

Budapest, September 20 (MTI) – Hungarian rate-setters left the base rate on hold at 0.90 percent at a policy meeting on Tuesday. In its September Inflation Report released, Hungary’s central bank cut its 2016 inflation forecast to 0.4 percent from the 0.5 percent inflation rate it predicted in June.

NBH leaves key rate on hold

The decision was in line with expectations.

The National Bank of Hungary’s Monetary Council signalled an end to an easing cycle at a policy meeting in May and have since stood by their position on keeping the base rate on hold, while leaving room for the possibility of using unconventional monetary policy tools.

Cbank cuts inflation forecast to 0.4 pc for 2016

In a new data release for 2017 the bank predicts inflation will be at 2.3 percent, down from the earlier prediction of 2.6 percent.

According to the report, the inflation goal of the central bank is still 3 percent, with a tolerance band of a percentage point in either direction.

Economic growth in 2016 is forecast at 2.8 percent, in line with the previous estimate.

The economy is expected to grow by 3 percent in 2017, unchanged from the June estimate.

Source: MTI