Hungary’s central bank (MNB) stepped up the pace of tightening today with a much larger-than-expected 185bp increase in its base rate, to 7.75%, and the hawkish communications underline the view that further large rate hikes are likely to be delivered over the next few months. We now expect the base rate to rise to 10.50% by the end of this year, compared to our previous forecast of 8.20%.
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