Hungary Sees 25bp Rate Cut to 5.50% as 1.2% Inflation Strengthens Easing Case
Updated
Updated · ING Think · Aug 24
Hungary Sees 25bp Rate Cut to 5.50% as 1.2% Inflation Strengthens Easing Case
3 articles · Updated · ING Think · Aug 24
Summary
A 25 basis-point cut on Aug. 25 would take Hungary’s base rate to 5.50%, extending the central bank’s summer “mini rate-cut cycle” but likely bringing that phase close to an end.
July inflation of 1.2% year on year came in below the central bank’s own forecast band, reinforcing expectations that September staff projections will mark down the inflation path further.
ING now sees the base rate falling below 5% by year-end, with a 4.75% terminal rate after three more cuts if no new geopolitical or energy shock derails easing.
Markets have already priced about 70bp of easing, while the forint has tested 366-367 per euro before recovering toward 362; analysts still see room for more cuts to be priced in if global sentiment improves.