BUDAPEST: The overhaul of the Hungarian central bank’s monetary policy toolkit will be largely completed this month, when its two-week deposit is phased out, the bank’s deputy governor Marton Nagy said on Friday.
Nagy said in a study published on website Portfolio that Hungary’s external debt had dropped as a result of the shift towards forint-denominated debt financing.
That means that the efficiency of the central bank’s interest rate swaps, which supported local banks’ purchases of Hungarian government bonds, is decreasing, Nagy said.
“All this justifies a strategic review of the programme… particularly with regard to the further necessity of the central bank’s IRS facility,” he said.
Copyright Reuters, 2016
Courtesy : BRecorder