Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Executive Summary:
- The National Bank of Hungary (NBH) is likely to hike its policy rate by 100bps on July 26, which would levitate the benchmark rate to 10.75%, the highest level since November 2008.
- The central bank has continued to aggressively intervene by raising both its 1W depo and base rates by 200bps in the beginning of the month to ease the selling pressure on HUF.
- Interestingly, the market is currently pricing in a lower hike than sell-side analysts’ median estimates; hence, risks are slightly skewed towards a lower hike (i.e. 75bps).
Link to full preview:
https://marketnews.com/mni-nbh-preview-july-2022-nbh-to-levitate-policy-rate-to-november-2008-highs
The National Bank of Hungary (NBH) is likely to hike its policy rate by 100bps on July 26, which would levitate the benchmark rate to 10.75%, the highest level since November 2008. The central bank has continued to aggressively intervene by raising both its 1W depo and base rates by 200bps in the beginning of the month to ease the selling pressure on HUF. In addition, the NBH is also likely to readjust its 1W depo rate by 100bps on Thursday.
Inflationary pressures continue to rise in Hungary, with CPI accelerating to 11.7% in June (vs. 11.5% exp.), up from 10.7% the previous month, diverging significantly from the NBH 4-percent upper tolerance band (figure 1, left frame). Hungary officials reiterated on several occasions that inflation would be running a few ppt higher in the absence of price caps.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.