1. At its meeting on 14 October 2002, the Monetary Council left the central bank base rate unchanged at 9.50%.

2. After discussing a number of basic assumptions and factors of risk, the Council agreed on the framework of the next issue of the Quarterly Report on Inflation, to be published on 19 November.

3. The Council welcomes the observations in the European Commission's 2002 Regular Report relating to Hungarian monetary policy. According to these, ‘a forward-looking and transparent inflation targeting regime succeeded in breaking high inflation expectations’ and, combined with a flexible exchange rate regime, ‘supports macroeconomic stability’. In the evaluation of the Report, the market's inflation expectations have increasingly been matching the NBH's guidance, owing to the Bank's open and transparent publication policy. In the Commission's view, the inflation targets agreed between the government and the Bank, at a maximum of 5.5% for end-2002 and 4.5% for end-2003, appear achievable without a significant cost for the real economy.

4. With effect from 24 September 2002, the Monetary Council appointed Academician Dr Béla Kádár its member for a term of 6 years.