Hungary's Central Bank Hesitates on Rate Cuts Amid Global Inflation Fears

Hungary's National Bank paused its rate-cutting streak on Tuesday, holding the base rate at 5.5%.

This decision comes despite annual inflation cooling to 1.3% in August, well below the bank's 3% target.

However, Governor Mihaly Varga warned of 'serious' global inflation risks, including energy prices and imported inflation.

The European Central Bank's recent rate hike by 25 basis points also narrowed the interest-rate gap that makes the forint attractive to foreign investors.