The Monetary Council of the Magyar Nemzeti Bank raised the central bank base rate by 15 basis points to 1.80 percent at its meeting on Tuesday, and also raised the interest rate corridor by the same amount, from 0.85 percent to 2.75 percent, MTI reported. Market analysts are also this size tightening was expected.
The board announced and began its cycle of raising interest rates in June, which it says will last until inflation returns to the sustainable range. The base rate has stood at 0.60 percent since July last year until the start of the current raising cycle.
THIS WAS THE FIFTH BASE INTEREST RATE INCREASE IN THE TICKET BANK, THERE WAS NO EXAMPLE IN HUNGARY BEFORE TEN YEARS.
As previously reported, György Matolcsy, the governor announced the cycle of interest rate hikes in June. The reason for the decision was that the economic recovery following the crisis caused by the epidemic was quite bright, but it also started inflation at a serious pace. The central bank is therefore trying to curb the process by constantly raising the base rate.
The central bank last raised in September base rate, then 15 basis points to 1.65 percent.