• Hungary’s government doesn’t need to immediately recapitalise the central bank as policymakers can conduct monetary policy even with negative equity, the NBH said on its website.
  • “The National Bank of Hungary considers that there’s no need for a capital injection for it to operate efficiently,” central bankers Zsolt Kuti and Csaba Balogh write, adding that future gains will eventually compensate losses.
  • The government has already drafted its 2024 budget without allocated funds for central bank recapitalisation, which was estimated to be 0.5% of GDP next year - more than $1 billion.
  • In June, Cabinet Minister Gergely Gulyas told reporters that the government will seek to “minimise” the fiscal outlay when responding to criticism that a draft budget for 2024 failed to account for the losses as required by law.

HUNGARY: Central Bankers Say NBH Can Conduct MonPol With Negative Equity

Last updated at:Jul-06 09:52By: Hiren Ravji
  • Hungary’s government doesn’t need to immediately recapitalise the central bank as policymakers can conduct monetary policy even with negative equity, the NBH said on its website.
  • “The National Bank of Hungary considers that there’s no need for a capital injection for it to operate efficiently,” central bankers Zsolt Kuti and Csaba Balogh write, adding that future gains will eventually compensate losses.
  • The government has already drafted its 2024 budget without allocated funds for central bank recapitalisation, which was estimated to be 0.5% of GDP next year - more than $1 billion.
  • In June, Cabinet Minister Gergely Gulyas told reporters that the government will seek to “minimise” the fiscal outlay when responding to criticism that a draft budget for 2024 failed to account for the losses as required by law.

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