The Monetary Council of the Hungarian National Bank (MNB) cut its benchmark interest rate by 75 basis points to 8.25% yesterday. It was the ninth rate cut since the downward trend began in March 2003. The decision surprised most analysts, as the market consensus was a 50 basis point rate cut.
MNB President Zsigmond Jбrai said the higher-than-expected cut was made possible by the good December and January inflation reports, adding that this does§nt necessarily mean cuts will continue at this rate in the future.
A month ago, Gyurcsбny expressed an opinion that lowering the benchmark interest rate to 8% would still ensure a neat income for foreign investors, with several analysts concurring in the view that MNB will cut the rate to % by the end of H1.
Source: Budapest Business Journal
