IMF Warns Hungary on Further Interest Rate Cuts

Hungary’s central bank should keep its benchmark interest rate on hold and adopt a tightening bias to avert any negative impacts from global market uncertainties, the International Monetary Fund (IMF) said late on Friday.

In its latest country report based on meetings with Hungarian officials in March and April, the IMF said Hungary’s interest rate differentials have reached record lows and further rate cuts could be risky to the country’s bond markets.

Hungary’s central bank (NBH) has been cutting its base rate continuously since August 2012, to a record low of 2.4 percent, and has left the door open to further easing.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza