Budapest, 28 February 2024 - The Magyar Nemzeti Bank welcomes the European Central Bank’s opinion that the amendment to the Central Bank Act initiated by the Hungarian Ministry of Finance cannot result in an impairment of central bank independence. Economic history teaches us that independent central banks are more successful in bringing down inflation and ultimately in creating the conditions for sustainable and steady economic growth. The Magyar Nemzeti Bank will continue to make every effort to achieve and maintain price stability.
The Ministry of Finance, referring – among others – to the modification of the scope of the tasks of the MNB’s Executive Board and the extension of the powers of the MNB’s Supervisory Board, has recently initiated an amendment to the Hungarian Central Bank Act. As the ECB’s opinion also points out, the Supervisory Board of the MNB, even in exercising its proposed new supervisory competences, shall not have the right to supervise any of the MNB’s activities that would directly or indirectly affect the MNB’s core tasks or those related to its membership in the European System of Central Banks.
Central bank independence is a core value which provides assurance that the central bank is able to concentrate on its long-term statutory mandate to achieve and maintain price stability, regardless of short-term economic policy objectives. Only an independent central bank can create the conditions for price stability by providing a predictable economic environment, anchoring economic agents’ inflation expectations and stabilising financial markets.
The Magyar Nemzeti Bank will continue to make every effort to achieve and maintain price stability. In order to achieve sustainable and steady growth, it is essential to ensure the independence of the central bank in performing its role as guardian of price stability.
The ECB’s position: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52024AB0005&qid=1709134548400