Analysts in Reuters poll unanimous in forecast of further MNB rate cut

MNB

All 23 analysts participating in a Reuters poll predicted that the Monetary Policy Council of the National Bank of Hungary (MNB) would cut its key interest rate a further 25 basis points to 4.5% at its rate-setting session next Tuesday, Reuters reported on Thursday. The analysts said that the MNB Monetary Council would cut the tenth time in as many months as a result of low inflation, which fell to a 38-year low 1.7% yr/yr in April, relatively high yields on government bonds and weak GDP growth of 0.7% q/q in Q1. The analysts said that these factors could prompt the MNB to remain on its easing cycle over the coming months. National Bank of Hungary Governor György Matolcsy said last week that the MNB could continue to cut rates if inflation does not exceed the bank's 3% mid-term target and if financial-market sentiment remains unchanged. The analysts participating in the Reuters poll predicted that average inflation would be 2.3% in Hungary this year.

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