In its latest publication the Magyar Nemzeti Bank (MNB) presented and summarized its responses with which was able to successfully handle the crisis caused by the coronavirus pandemic.
Governments and central banks have responded with historical scale crisis management measures to the pandemic broke out in early 2020. The former launched a number of job protection and economy stimulus programs, the latter provided liquidity to all actors in the economy and helped economies to restart.
The coronavirus pandemic has caused a triple crisis: economic, health and psychic. Financial crisis similar to 2008/2009 has been avoided by strong, proactive and preventive economic policy measures.
The MNB responded at the right time and with massive firepower to the coronavirus pandemic providing approximately HUF 9,300 billion in liquidity to the actors of the economy by the end of May 2021:
- The MNB’s balance sheet to GDP ratio rose by 18 percentage points
- The MNB supported the government budget by paying HUF 500 billion in dividends
- Implemented over HUF 2,200 billion government securities purchases
- Provided funding of over HUF 2,800 billion to almost 40,000 SMEs under the FGS Go! scheme
Hungary can expect complete recovery instead of post-covid syndrome with the restart of the economy. Then, the focus has to shift back to restoring economic balance, because in the 21st century we need a development that will be financially, environmentally and socially sustainable in the long term.