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ING Expecting a 125bps Hike This Week

HUNGARY
  • ING expects the National Bank of Hungary to remain committed to its decisive tightening cycle and sees both the base rate and the one-week deposit rate rising by 125bp to 11.00%.
  • The forward guidance will remain hawkish, suggesting further rate hikes as ING is still waiting for inflation to peak in Hungary.
  • Whether this will be enough to give support to the forint remains to be seen. Market expectations regarding tightening are extremely elevated but ING sees the bar for the market to be disappointed as low.
  • When it comes to data releases, ING will get the latest labour market data, which will flag further price pressure in the pipeline with remarkably high wage growth and a near-record low unemployment rate.

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