Hungary’s central bank reduced its key interest rate by 15 basis points for the fifth straight month on Tuesday.
The Monetary Council of the Magyar Nemzeti Bank decided to cut the base rate to a record low 1.35 percent from 1.50 percent. This was the fifth consecutive reduction in rates.
Economists had expected the rate to be lowered to 1.40 percent.
The new rate will take effect on July 22. It had lowered the rate by 15 basis points each in March, April, May and June.
At the press conference, Magyar Nemzeti Bank Governor Gy?rgy Matolcsy will indicate that the easing cycle is now over, William Jackson, an economist at Capital Economics, said. Equally, however, with inflation set to remain below target both this year and next, he is likely to stress that policy will remain loose for a long time.
For now, the benchmark policy rate is set to stay at 1.35 percent both this year and next, Jackson said.
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