Hungarian base rate lowered to all-time low

The Monetary Council of Hungary’s central bank (MNV) has decided to lower the base rate by 25 basis points to an all-time low of 5.00% on Tuesday, in line with the market’s call. It was the first rate setting under newly appointed Governor György Matolcsy.

According to the Hungarian financial website portfolio.hu, its analysts said last week it would take a miracle for rates to remain on hold, whereas some said a 50-bp cut was also on the cards, although others claimed the hands of the Monetary Policy Council (MPC) of MNB in this respect were tied by the weak forint.

There is total uncertainty at the moment as to what arguments the new MPC will offer, especially as Matolcsy scrapped the post-meeting press conference - not just for today, but for the future, too.