The high budget and current account deficits are such that Hungary is again trapped in a twin deficit, one that it successfully emerged from after 2010. But now the associated risks are greater, Matolcsy said.Continue reading
Inflation is central banks’ greatest foe, and tackling it is a vital step towards creating monetary sustainability, György Matolcsy, the governor of Hungary’s central bank (NBH) wrote in an article published by pro-government daily Magyar Nemzet on Monday.
Eighty percent of Hungary’s inflation is imported, Matolcsy noted.
The governor also said the NBH’s general quantitative easing programs would be replaced by targeted credit facilities.
Matolcsy also wrote about the future of central banking in his article, saying that central banks must embrace innovation.
He noted that the NBH had been handed a green, sustainability mandate, which was the first in Europe.
Matolcsy argued that today’s two-tier banking system should become more diverse, thereby forging a stronger financial system.
Featured photo by Szilárd Koszticsák/MTI