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NBH Raises Policy Rate By 30bps To 2.4%

HUNGARY
  • The NBH decided to raise its policy rate by 30bps to 2.4% (vs. 2.5% market consensus), continuing its gradual monthly tightening cycle.
  • The 1W deposit rate has become the effective policy rate for Hungary, which policymakers have increased by 150bps in the past month to 3.30%.
  • We expect the 1W deposit rate to reach 4% in early 2022 and the policy rate to gradually converge towards the 1W deposit rate through H1 2022.
  • HUF is slightly weaker following the decision, with USDHUF rising above the 324 level after testing its local support at 323 earlier.
  • The press briefing (with statement) will begin at 2pm (London time).

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