Hungarian Central Bank Official Breaks Ranks Amid Currency Crisis

The Hungarian central bank's Deputy Governor, Mihaly Patai, diverged from his colleagues by advocating for a 25-basis-point rate cut. Despite this dissenting opinion, the bank opted to keep the base rate unchanged at 6.5%, the highest in the EU, amidst a weakening forint against the euro.

In a surprising move, Deputy Governor Mihaly Patai of the Hungarian central bank voted for a 25-basis-point interest rate cut last month. This decision marked his departure from the majority view favoring unchanged rates.

The minutes of the meeting, held on November 19, highlighted Patai's differing assessment of the economic and financial market conditions. Despite his push for rate reduction, the central bank maintained its base rate at 6.5%, making it the highest in the European Union.

Meanwhile, the forint plummeted to a 22-month low against the euro, intensifying debates about the necessity of interest rate adjustments to stabilize the currency.

(With inputs from agencies.)