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Hungary to Hike Key Rate as Forint Plunges Again: Decision Guide

  • Tumbling currency complicates plan to end tightening cycle
  • Hungary’s dispute with EU adds to investors’ concerns
Hungary’s forint is near an all-time low against the euro and, having fallen 9.7% this year.

Hungary’s forint is near an all-time low against the euro and, having fallen 9.7% this year.

Photographer: Akos Stiller/Bloomberg

Hungary will raise its key interest rate to a new European Union high as a standoff with the bloc over the rule of law complicates the central bank’s efforts to end its monetary-tightening cycle. 

Policy makers will raise the benchmark interest rate by a full percentage point to 12.75%, according to 8 out of 12 analysts in a Bloomberg survey. The decision -- along with new quarterly economic forecasts -- will be announced at 2 p.m., after which central bank Deputy Governor Barnabas Virag is expected to speak at 3 p.m.