The press release accompanying the Hungarian MPC’s meeting earlier today suggests that the Council thinks the need for additional monetary easing has diminished. As a result, we have taken the very modest policy easing that we had previously expected out of our interest rate profile. Even so, with the MPC still sounding too optimistic on the economy’s growth prospects, we expect monetary conditions to remain extremely accommodative. The policy rate is set to stay at its current record-low level over 2017.
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