No change in the MNB base rate is expected from tomorrow's monthly rate-setting meeting

HUNGARY - In Brief 27 Apr 2026 by Istvan Racz

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Portfolio.hu, the economic news site that regularly surveys analyst views, is saying that analysts typically do not expect a change in the MNB's 6.25% base rate at the monetary Council's monthly meeting tomorrow. They also added that the majority of the analysts they asked think that a further forint appreciation to 350-360 EURHUF is conceivable over the coming few months.Regarding the base rate, we fully agree. Even though CPI-inflation currently stands below the 2-4% tolerance band and the forint has appreciated quite a lot on election results, there would not be enough reason to reduce interest rates, as (a) the global environment is a mess and there is a great deal of uncertainty around prospective energy import prices and even food prices, in case shipping oil, gas and fertiliser out of the Persian Gulf remains impossible; and (b) at this point, the bank cannot have too much of specific information about the incoming government's prospective fiscal and income policies. Very probably, the problem mentioned under (b) above will change for the better in two or three months from now, whereas the problem mentioned under (a) may or may not stay with us for a longer while.As for the prospect of some further forint appreciation, yes it may happen, as the market may produce strange things sometimes. But the Reader is kindly encouraged to consider how much such a steep forint appreciation in such a short period is necessary, and what it would do to the economy and the government budget. Well, we think it is not necessary in the sense that it is not required for headline CPI-inflation to remain within the tolerance band. Even though the MNB expected inflation to rise to abov...