Hungarian central bank cuts base rate to low of 4.0%

Hungary's central bank (MNB) cut its base rate to a record low of 4.00 percent on Tuesday, the 12th monthly cut in a row since last August. The 25-basis-point cut, the same as in the previous months, was however widely expected by economists to be the last in the cycle as the MNB has recently signalled increasing caution over external risks. "The (bank's rate-setting) Monetary Council has decided to lower the base interest rate by 25 basis points to 4.00 percent," the MNB said in a statement on its website. MNB governor Gyorgy Matolcsy, former economy minister and a close ally of Prime Minister Viktor Orban, was due to hold at 1300 GMT a news conference, the first since his controversial appointment in March. The exchange rate of Hungary's forint was stable following the announcement, shifting from 295.20 versus the euro before the cut to 294.77 just after.