Hungary cuts central bank base rate by 50 bps to 10%

By Richard Connell

New York, Dec. 22 - The Monetary Council of the Magyar Nemzeti Bank reduced its central bank base rate by 50 basis points to 10% at its meeting on Monday, according to a press release issued by the bank.

The council of the Hungarian central bank noted that inflation has been dropping, and believes that it may fall significantly below the target level of 3%.

The council also pointed out that the continued slowdown in the global economy has had a negative effect on Hungary's economy, and it is not expecting a recovery until at least 2010.

The board has now cut the base rate by a total of 1.5% since the extraordinary increase of 300 basis points on Oct. 22.

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