Hungarian Central Bank Cuts Interest Rate
Monday June 20, 10:03 am ET
Hungarian Central Bank Cuts Benchmark Interest Rate to 7 Percent
BUDAPEST, Hungary (AP) -- Hungary's central bank cut its benchmark two-week deposit rate Monday by a quarter of a percentage point to 7 percent, citing favorable inflation data.
The bank said it expected the favorable inflationary trends to continue in the long term, adding that the year-end inflation target of 4 percent was sustainable.
Annual inflation slowed to 3.6 percent in May.
Analysts said the cut was unlikely to have a major impact on government bond yields or the currency market as the move had been generally expected.
The central bank lowered its key interest rate five times this year -- the previous cut was announced May 23 for a decrease from 7.50 percent to 7.25 percent.
The bank warned, however, that investors' volatile appetite for risk could potentially have a negative impact on Hungarian inflation.
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