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GS on NBH

HUNGARY
  • GS expects the MNB to raise its base rate and the 1-week deposit rate by 100bp to +10.75%, in line with consensus expectations.
  • While challenging inflation dynamics called for further rate hikes, the aggressive tightening was due to significant exchange rate depreciation pressures.
  • The inflation problem remains unresolved, with GS inflation expectations measures reaching all-time highs, and underlying inflation running at a sequential pace that is in excess of already high annual inflation rates.

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