Analyst: The Hungarian forint remains weak after the interest rate remains unchanged.
As expected, the Hungarian central bank kept the interest rate unchanged at 6.5%, causing little movement in the Hungarian forint against the euro, maintaining a weak position. Nicholas Farrow, a macroeconomist at Capital Economics, said in a report that risks seem to favor implementing a looser monetary policy in Hungary before the parliamentary elections in April, as recent data showed a slowdown in inflation in December and a further decline in the current quarter. "That being said, we still believe that the scale of rate cuts this year will be limited." He said that inflation may soon rise above the target level again, and the budget deficit may exceed 5% of GDP. The euro rose 0.1% to 380.92 forints, with little change compared to the level before the announcement.
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