After raising its base rate by a larger-than-expected 125bp, to 13.00%, Hungary’s central bank (MNB) announced today that it has now ended its rate hiking cycle and we now forecast the base rate to be left on hold over the coming year. Even so, with core price pressures still very strong and the risks skewed towards a weaker forint, we think there is still a chance that the MNB may have to hike rates a bit further.
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