The Hungarian central bank on Tuesday decided to keep its policy interest rate unchanged at 7 percent for the seventh time in a row. The decision was in line with economists' expectations.
The last time the Magyar Nemzeti Bank made changes to the rate was in December last year, when it hiked it by 50 basis points, following a similar increase in the preceding month.
The International Monetary Fund (IMF) last month approved the Hungarian government's amendments to a central bank legislation that had hampered the country's bailout talks since last year as stakeholders, including the Fund, said the law paused a major threat to its monetary-policy independence.
Hungary's annual inflation accelerated to a bigger-than expected 5.6 percent in June from 5.3 percent in May, driven mainly by higher food and utility costs. Core inflation rate was at 4.9 percent during the month.
The economy contracted 0.7 percent annually in the first quarter as almost half of the industries recorded stagnation, after expanding 1.4 percent in the fourth quarter.
by RTT Staff Writer
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