Yesterday the monetary council of the National Bank of Hungary left the central bank base rate, which equals the key two-week depo rate, unchanged at 9.50%.
The council noted that the forint has continued to firm and returned to the stronger half of the 250-260 range against the euro. It said the current exchange rate will reduce inflationary expectations, and make it possible for the expected rise in inflation to be temporary, or a twelve-month CPI of no more than 5.5% in December 2004, and a further reduction of inflation after that.
The 5.5% CPI for the end of 2004 is lower than the 5.8% rate forecast in the bank's August Inflation Report.
Source: Budapest Business Journal
