The consensus of Hungary analysts polled by both business portal portfolio.hu and Reuters is that the Monetary Council of the National Bank of Hungary is expected to leave interest rates on hold at 6% at today's rate-setting meeting. Announcement of the results from the meeting is scheduled for 2pm local time. The sharp weakening of the Hungarian forint at the beginning of last week raised prospects of a hike as the forint eased towards levels of 266 against the euro. However, the forint rebounded later in the week and traded around 260. The Hungarian market showed unexpectedly strong volatility in the light of weak fundamentals (particularly the budget deficit), but the central bank will probably not risk supporting the local currency with a rise in interest rates. The end-2007 inflation target of 3% is still well within reach despite the somewhat disappointing January and February Consumer Price Index data. A hike could send the wrong signals to the markets. Nonetheless the meeting is expected to stress the worsening of the international investment environment and bleak fiscal outlook.
Poland's industrial output remained unchanged month-on-month in February and rose by 10.1% year-on-year, the Central Statistical Office announced in a press release on Friday. Industrial output increased by 1.8% month=-n-motnh and 9.8% year-on-year in January. In February construction output was down by 3.5% year-on-year, and up 13.1% month-on-month. Analysts surveyed by the news agency ISB had expected February's industrial output to grow by 8.0% to 10.4%, with the average at 9.5% year-on-year.
News from Euromoney Group sources