National Bank of Hungary likely to stand pat this week

The Hungarian central bank, National Bank of Hungary, is set to meet tomorrow for its interest rate decision. According to a KBC Market Research report, there will not be any change in the conditions of the NBH monetary policy; however, the risk of monetary tightening has risen a bit as inflation reached a new peak in April and the core rate is also running above the inflation target.

In spite of all these facts, the central bank is expected to be quite happy with the current scenario. The latest stability report highlights that in spite of the booming mortgage market there is no real risk and Hungary is one of the safest in the EU as the debt level is still low even compared to the GDP or to the disposable income.

“Also the loan the value ratio is subdued and the overwhelming majority of the new loans have fixed interest rates. These statements suggest that the NBH would stay on hold”, added KBC Market Research.