HUNGARY: Virag Says NBH May Pause Rate-Cut Cycle or Make Smaller Cuts

Deputy Governor Virag comments in his post-decision press conference:

• “Hungary may pause rate-cut cycle or make small cuts”
• “Hungary to make separate call each month on rates”
• “Hungary core CPI expected rise limits rate-cut room” - BBG

EURHUF traded to a new session low, below 394.00, amid the comments from Virag, as the risk-on tone across markets provides an additional tailwind to the forint. Sell-side had broadly been expecting NBH communication to tilt in the hawkish direction, with a possible pause to the central bank's rate cutting cycle well-noted. Last month, the Deputy Governor said the scope for additional rate cuts beyond June appears “very, very limited”. For EURHUF, initial support still lies some way off at 392.44, the 20-day EMA.