Country Analysts

Istvan Racz
Former Director, Central Bank


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Recent Country Insights

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Another interest rate step from the MNB: the corridor was raised today
HUNGARY - In Brief 30 Nov 2021
In a brief statement today, the MNB said that at today's meeting, which was not one of its monthly rate-setting meetings by the way, the Monetary Council raised the interest rate corridor significantly and made it asymmetrical. The base rate was left unchanged at 2.1%.The new corridor looks like ...

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Good news on Covid, at last
HUNGARY - In Brief 28 Nov 2021
A so-called Vaccination Week is being held in Hungary since Monday, meaning that people can get Covid vaccines at a big number of 'vaccination points' (typically hospitals) without any previous registration, through extended hours every day. As a result, nationwide vaccination numbers have starte...

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A Thanksgiving Day gift from the MNB
HUNGARY - In Brief 25 Nov 2021
The MNB has set its fixed interest rate for this week's 1-week deposit tender at 2.9% today. This represents another 40 bps hike from last week, and a total 110 bps increase in the effective sterilisation rate, including all three steps carried out over the last nine days. By this step, the MNB i...

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The forint is a bit too weak, though not dramatically
HUNGARY - In Brief 23 Nov 2021
The current EURHUF 371 exchange rate is a bit too weak from the MNB's point of view.The press keeps stressing that the forint has weakened to its historical record low. This does not mean a lot, of course, but somehow the press tends to be in love with records. A more reasonable way of assessment...

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Monetary tightening accelerated in November
HUNGARY - Report 19 Nov 2021
The 4th domestic wave of Covid continues to rise rapidly. Daily new infections and deaths exceed those in the 2nd wave of late 2020, and Hungary has one of the highest R0 globally. With the current speed of virus spreading, reaching the limits of hospital capacity could be only a few weeks away. ...

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Unusually big rate hike from the MNB
HUNGARY - In Brief 18 Nov 2021
The MNB has just announced that it will pay an 2.5% interest rate on the 1-week deposits placed with it at today's tender. This represents a 40bps increase compared to the new level of the base rate, as set two days ago, and a full 70bps increase from last Thursday's tender.The fact that the 1-we...

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The MNB raised 30bps... or maybe more (?)
HUNGARY - In Brief 16 Nov 2021
The Monetary Council held its monthly rate-setting meeting in a difficult situation, but its decision largely met the challenge.In response to the nearly runaway mode inflation took in October, the MNB took the following decisions:1. It raised the base rate and the interest rate corridor by 30bps...

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Q3 GDP growth moderately below analyst forecasts
HUNGARY - In Brief 16 Nov 2021
GDP growth for Q3 has been reported at 0.7% qoq, 6.1% yoy on seasonally and day-adjusted basis this morning. In two domestic polls, the analyst median expectation was 7.2 and 7.4% yoy. Our own forecast was 6.8% yoy.Even though no breakdown was given by KSH, as usual with first estimate GDP report...

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Fuel prices frozen for three months from next week
HUNGARY - In Brief 11 Nov 2021
The government cabinet decided today to set a HUF480 per litre administrative maximum for the consumer prices of fuels, for three months starting from next Monday (November 15). This level is 5.1% below the current average price of gasoline-95 and 6.3% below the average price of diesel.This measu...

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