Hungarian rate-setters cut the central bank’s base rate by 15 basis points to 1.65% on Tuesday, in line with market expectations. The Monetary Council said: “Cautious easing of the policy rate may continue as long as it supports the achievement of the medium-term inflation target.” A cautious approach was warranted by “uncertainty in the global financial environment”. Erste Bank analysts Vivien Barczel and Gergely Ürmossy said after the decision that the easing cycle could continue in June with another 15 basis point cut. Takarékbank chief analyst Gergely Suppán also augured another 15 basis point rate cut in June but suggested it would be the last of an easing cycle restarted in March. Tightening will start no earlier than autumn 2016, he said, putting the end-2016 base rate at 1.8%.
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