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Record weak forint: Hungary’s national bank is ready to fight
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The National Bank of Hungary (NBH) is committed to protecting the forint. Furthermore, they even sent a clear message to the fifth Orbán government about the weakening national currency.
National bank committed to stopping the weakening of the forint
According to hvg.hu, the National Bank of Hungary considers the weakening of the forint as a serious inflation risk. They added they would take firm actions to stop negative processes. They even sent clear messages to the government highlighting that the administration could support those aims if the state budget had been in balance.
Barnabás Virág, the national bank’s deputy governor, highlighted many times at a Tuesday press conference that they would take firm actions and use all available means to deal with processes on the foreign exchange markets endangering the country’s inflation goals.
Mr Virág said that after the national bank raised the base rate by 200 basis points on Tuesday the inflation rate continued to rise. He added that prolonged inflation risks made it necessary to continue the base-rate tightening cycle. The NBH continuously monitors developments in financial market risks and stands
ready to intervene in a decisive manner using every instrument in its monetary policy toolkit, if necessary,
Virág said. In the interest of mitigating second-round inflation risks, maintaining tighter monetary conditions for a longer period is warranted, he added. The weak forint is heating inflation through the import, he said.