Base rate unchanged at 6.5, as widely expected
Hungary, Romania run EU39;s joint highest benchmark rate
Czech central bank could also halt rate easing on Thursday
Central Europe39;s rate cut rally stalling after steep cuts
BUDAPEST, Dec 17 Reuters Hungary39;s central bank left its base rate steady at the European Union39;s joint highest level of 6.5 on Tuesday, as widely expected, with falls in the forint, a rebound in inflation and an uncertain economic outlook making policymakers cautious.
SP Global said on Thursday that central Europe39;s monetary easing campaign had entered a riskier stage, with a higher likelihood of policy missteps due to global economic uncertainty and exchange rate volatility.
The Czech National Bank is also widely expected to leave its main rate unchanged on Thursday, which would mark the first time since Hungary started cutting rates in May 2023 that all four of the region39;s central banks have kept rates on hold in the same month.
The latest Reuters poll forecasts project just 100 bps worth of additional rate easing in Hungary and Poland by the fourth quarter of 2025 and 75 bps in the Czech Republic and Romania.
Most fundamental factors are moving in a direction opposed to monetary easing right now, Commerzbank economist Tatha Ghose said in a note before the Hungarian rate decision.
Against this background, there is no reason for the National Bank of Hungary to consider restarting a rate cutting cycle when they have already been on…