FX.co ★ Hungary Holds Rate Unchanged at 6.5%

In its January 2026 meeting, the National Bank of Hungary opted to maintain its key interest rate at 6.5%, a decision aligned with market expectations. This move sustains the rate cut cycle concluded in September 2024. Notably, this decision comes despite a shift in guidance during the previous meeting, where the bank moved away from definitively ruling out rate cuts. Instead, it signaled a more flexible approach, indicating it would assess interest rate decisions on a meeting-by-meeting basis. Recent data revealed that inflation decelerated to a 14-month low of 3.3% in December, nearing the midpoint of the bank's 3% target range. However, the sharp rise in services inflation to 6.8% tempers the outlook for any immediate rate cuts by the central bank.