Bloomberg News

Hungarian Yields Hit Six-Day Low After Central Bank Holds Rates

March 27, 2012

Hungary’s government bonds strengthened, sending yields to a six-day low, after the central bank kept the European Union’s highest benchmark interest rate unchanged today.

Gains in the benchmark three-year notes cut yields four basis points, or 0.04 percentage points, to 8.57 percent, the lowest since March 21. The forint was 0.2 percent weaker at 292.11 against the euro at 2:37 p.m. in Budapest. The Magyar Nemzeti Bank left its two-week deposit rate at 7 percent for a third month, matching the forecast from all 26 economists surveyed by Bloomberg News. Central bank President Andras Simor will explain the decision at 3 p.m. in Budapest.

“The forint might benefit today should central bank President Andras Simor acknowledge the rising inflation risks,” Carolin Hecht, a Frankfurt-based strategist at Commerzbank AG, wrote in a research report.

Consumer prices in February rose 5.9 percent from a year earlier, the fastest pace in the EU, driven by fuel and household energy costs, data published on March 13 showed.

To contact the reporter on this story: Andras Gergely in Budapest at agergely@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net


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