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May 23, 2018

The National Bank of Hungary keeps base rate on hold at 0.9 percent

The Monetary Council also left the O/N central bank deposit rate at 0.15 percent and the O/N collateralized loan rate at 0.90 percent at a meeting on Tuesday

The National Bank of Hungary has left the central bank’s base rate on hold at 0.9 percent.

The Monetary Council also left the O/N central bank deposit rate at 0.15 percent and the O/N collateralized loan rate at 0.90 percent at a meeting on Tuesday.

In a statement, the Council said that “maintaining the base rate and the loose monetary conditions at both the short and long ends for an extended period is necessary to achieve the inflation target in a sustainable manner”, echoing the policy stand voiced in previous months.

However, in a slight change to its earlier statements, the Council made references to “the current set” of monetary policy instruments, rather than “the extended set”, suggesting that it has no plans to add to that set of tools.

“In line with the Council’s forward guidance, the current set of instruments contributes efficiently to the maintenance of the loose monetary conditions over a prolonged period and to an improvement in financial stability,” it said.

“The Council will closely monitor developments in monetary conditions and will ensure the persistence of loose monetary conditions over a prolonged period by using the current set of monetary policy instruments,” the policymakers added.