Much depends on how quickly the vaccination of society can develop, and fortunately the Hungarian economy could grow by as much as 6 percent this year, according to the Magyar Nemzeti Bank. According to Barnabás Virág, the vice-president of the central bank, it is currently justified to forgive the debt in order to resume growth, after which the restoration of stability can be addressed.
The Magyar Nemzeti Bank (MNB) strives for a targeted and prudent interest rate policy, keeping a safe distance from the near-zero range, he said. in an interview with Portfolio.hu Flower Barnabas.
According to the central bank:
- The MNB estimates economic growth in the 3.5-6 per cent range this year. The 3.5 percent scenario assumes that significant vaccination in society will be achieved by the middle of the year, and the 6 percent growth scenario could materialize if vaccination is achieved in the second quarter.
- Those countries that were able to overcome the difficulties with smaller real economic sacrifices, where the role of the digital economy was significant in the past, Hungary has to catch up with them.
- The Hungarian National Bank is also examining the possibilities offered by digital money.
- Attitudes towards monetary policy have not changed, and a prudent, prudent policy is still needed, as there are still significant risks in the global economy. This caution is also true of the relationship between the base rate and the one-week deposit rate.
- Inflation has been falling steadily since September, we must not sit back, we must remain vigilant now, especially as the price level is expected to rise in the first half of this year due to base effects.
- Central bank balance sheet expansion may continue, which will support economic recovery. In an emergency, this is acceptable and even necessary, but we must be prepared to restore balance and reduce debt rates in the future.
- The Monetary Council is absolutely united in its assessment of the situation.
- As long as necessary, the central bank’s government securities purchase program will continue.
- The central bank is happy that the state has stepped in to support the economy, but it would have been better if it had done so sooner.
- New types of investment are needed to improve energy efficiency, help the transition to a green economy and strengthen digitalisation.
*The article has been translated based on the content of Napi.hu by www.napi.hu. If there is any problem regarding the content, copyright, please leave a report below the article. We will try to process as quickly as possible to protect the rights of the author. Thank you very much!