Analysts at Goldman Sachs said they expect the MPC to cut rates by a “symbolic” 10 basis points on Tuesday. Following the recent forint weakening, “we also expect the MPC to shift to an even more cautious tone but not to exclude further easing”. “We think the MPC will try to combine the goals of policy easing and preserving financial stability (...)

A small cut will allow for a marginal easing in monetary conditions, while a move towards a smaller pace of cuts, and even more cautious language should underline the MPC’s willingness to respond to market sentiment”, Goldman Sachs’s analysts said. London-based economists at JP Morgan also said they expect the central bank to slow the pace of easing to 10 basis points at Tuesday’s MPC meeting, taking the policy rate to 2.75%.

Economists at Barclays said they think the central bank will cut by only 5 basis points and announce a pause. “We believe the NBH will be content to pause now to assess where the more-than-400 basis points of cuts in the past 19 months have gotten it and the possible implications of increasing money supply through the Funding for Growth Scheme,” they said.

Source www.hungarymatters.hu

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