Hungary's central bank (MNB) unexpectedly cut its benchmark interest rate a quarter-point, reducing borrowing costs for the second time in two weeks as government spending cuts boost investor confidence.
The Monetary Council lowered the two-week deposit rate to 12 per cent from 12.25 per cent.
Six of 11 economists polled by Bloomberg expected the bank to leave the rate unchanged. The bank was able to reduce the highest rate in the 10 countries that will join the EU next month as the forint gained on optimism that the government will be able to cut the country's budget deficit.
Source: Budapest Business Journal
