Hungary Leaves Base Rate Unchanged for 11th Month

2025-08-26 12:12 By Dongting Liu 1 min. read

The National Bank of Hungary held its key interest rate unchanged at 6.50% for the eleventh consecutive meeting on August 26, in line with market expectations.

The overnight deposit and collateralized loan rates also remained at 5.5% and 7.5%, respectively.

GDP rose by 0.1% year-on-year in Q2 2025, according to preliminary estimates, reflecting subdued economic growth.

Economic growth is expected to pick up from next year, supported by rising real wages, government tax cuts boosting consumption, and stronger exports due to improved European performance and capacity-increasing investments.

Headline inflation eased to 4.3% in July, remaining above the central bank’s tolerance band, and is expected to remain above the band for the rest of 2025.

The unemployment rate remained low, while wage growth slowed in May.

Given persistent inflationary pressures and global uncertainties, the National Bank of Hungary maintains a cautious and restrictive monetary policy stance.



News Stream
Hungary Cuts Key Interest Rate as Inflation Falls
The National Bank of Hungary cut its benchmark interest rate by 25 bps to 6% at its June 2026 meeting, in line with market expectations, resuming its easing cycle as inflation continues to ease, helped by a stronger forint and softer import costs. The currency has gained more than 8% against the euro this year, significantly improving Hungary’s inflation outlook by reducing the price of imported goods. The annual inflation rate eased to 1.8% in May from a three-month high of 2.1% in the previous month, giving policymakers more room to cut rates further. The easing cycle contrasts with central banks elsewhere in Europe, where energy-driven inflation risks linked to geopolitical tensions have kept policy tighter.
2026-06-23
Hungary Holds Rate as Expected
The National Bank of Hungary held its base interest rate unchanged at 6.25% in its May 2026 meeting, as expected by markets, to maintain benchmark borrowing cots at their lowest in four years. The hold was also signaled by the central bank earlier, preluding expectations of looser monetary policy this year. NBH Governor Varga noted the outlook for inflation is favorable due to the recent strengthening of the forint after Peter Magyar was elected Prime Minister. The outlook contrasts sharply with that of other EU countries, which are likely to see higher rates as the war in the Middle East tightened energy supply and lifted their prices.
2026-05-26
Hungary Keeps Monetary Policy Unchanged
The National Bank of Hungary left its benchmark rate unchanged at 6.25% in its April 2026 meeting, as widely anticipated, marking the second consecutive hold. The decision reflects a cautious stance amid rising global risks, including geopolitical tensions related to the Iranian conflict, which have lifted energy prices and increased inflation pressures. Meanwhile, uncertainty over domestic fiscal policy keeps the central bank in a wait-and-see position, with authorities awaiting concrete government plans to address a sizeable budget deficit. This was despite domestic inflation remaining below the central bank’s 3% target and the forint appreciating following the April elections. The annual inflation quickened to 1.8% in March from 1.4% in the previous month, but remained close to its lowest level in nine years.
2026-04-28