EUR/HUF targeted at 325.00 by end-2016

The MNB holds its benchmark interest rate unchanged at 1.35% as excepted. The central bank did not give any indication of fresh rate cuts next year. 

The central bank will be set to implement fresh QE measures before a rate cut is expected. The Bank may implement QE measures by re-launching cheap lending schemes that is about to expire in December, and also measures to increase banks' holding of government bonds. 

Commerzbank expects the base rate to cut to 1%, however, this will depend on ECB's stance "Based on our view of monetary easing through 2016, we see EUR/HUF at around 325.00 levels by end-2016", it added.