Poles apart

As expected, Hungarian policymakers kept interest rates unchanged at 6.00% for the third consecutive meeting today. As in the Czech Republic, we now expect rates to remain on hold into 2012. However, Poland is the odd-one-out in Central Europe. March’s slightly weaker than expected labour market data perhaps argue against policymakers making it two-in-a-row at the next meeting. But the MPC’s hawks are in the ascendancy and we now expect interest rates to reach 4.50% by the end of this year (from 4.00% at present).