Base rate to hold steady throughout the year?

Is it possible that the Hungarian National Bank (MNB) will not cut interest rates at all in 2025? That’s exactly what a member of the Monetary Council claims.

Gyula Pleschinger gave a kind of farewell interview to the Reuters news agency, as his mandate on the Monetary Council will end shortly. ‘I see no room for interest rate cuts this year,’ explained the expert, referring to the development of consumer prices.

The inflation rate is likely to have climbed above 5% in January and the MNB’s target range of 2-4% will probably only be reached again shortly before the end of the year. Average annual inflation could rise to 4.1-4.2%, compared to 3.7% in the previous year. A trade war between the EU and the US would further increase the risk of major price rises. The MNB is maintaining the highest key interest rate in the EU at 6.5%, not least due to the vulnerable forint exchange rate.