MNB Cuts Rates
Hungary's central bank cuts interest rates, sees room for further cuts if conditions persist
Committed to achievement of inflation target in a sustainable manner - - Decision on their continuation to be made based on the September inflation report - - Global risk environment has become more favorable - - Baseline scenario in the June forecast is surrounded by balanced inflation and upside growth risks - - Stronger forint, as well as the decline in energy and food prices has resulted in lower inflation - - Stronger forint curbs price growth - - EU funds can boost investments from next year - - Productivity needs to improve - - Varga: Sees three rate cuts of 25 bps each over summer.
Sees ‘mini interest rate cut cycle’ - - Staff Forecasts - Inflation - - Cuts 2026 CPI forecast from 3.8% to 1.8% - - Cuts 2027 CPI from 3.7% to 2.3% - - Maintains 2028 CPI at 3.0% - Growth - - Raises 2026 GDP forecast from 1.7% to 2.0% - - Maintains 2027 GDP at 3.0% - - Maintains 2028 GDP at 2.9%