Budapest, 8 March 2025 – The new management of the Magyar Nemzeti Bank was committed to reducing inflation, with its primary goal being to achieve and maintain price stability, according to Mihály Varga, who spoke at the Hungarian Chamber of Commerce and Industry’s Economic Year-Opening Conference in Budapest. The central bank governor emphasised that, despite the unpredictable international environment, the Hungarian economy’s equilibrium positions had improved significantly, the financial system was stable, and growth prospects were favourable.
Governor Varga noted that the 2020s had brought a significant slowdown in the global economy, with increased budgetary expenditures and rising public debt ratios in developed countries, and a return to inflation levels not seen in decades. He pointed out that the consumer price index in Hungary had been rising gradually since September 2024, reaching 5.5 percent by January 2025, mainly due to increases in fuel and food prices. The central bank governor warned that if inflation returned on a sustained basis, it would erode the purchasing power of wages and the budget balance, undermine confidence, slow economic growth and increase the cost of financing public debt. Bearing this in mind, the Magyar Nemzeti Bank was pursuing a disciplined, consistent, anti-inflationary monetary policy, while closely monitoring external and internal developments and the risks surrounding the outlook, according to Varga. The Governor of the MNB went on to emphasise that growth in the Hungarian economy was broad-based, with strong employment and real wage growth, rising consumption and high levels of household savings pointing to an improvement in growth prospects. Varga explained that under the current economic conditions the central bank could contribute most effectively to the achievement of macroeconomic objectives by delivering price stability and maintaining financial market stability. He concluded by saying that the path to lower budget interest expenses, improved consumer confidence, a predictable investment environment and economic recovery lay in maintaining price stability.