Hungary meets part of demand on central bank law
Polish industrial output data closely watched by the NBP
Yesterday, talks between the Hungarian government and the EU had another round. The Hungarian government modified the Consittution and cancelled the paragraph that enabled the merger of the central bank and the Financial Supervisor. The EU Commissiner’s spokeman said that the five party talks between experts from the EU/IMF/ECB/Govt/MNB had a good spirit, but did not detail further what this could mean for the future.
It is important to see that that there remained several open questions about the central bank law including the oath on the new Constitution, the salary cap, the appointment of two new Council members and a new Vice President. It will also be important how the EU sees the upcoming Convergence Program that includes the measures to meet next year’s 2.2% of GDP deficit target. In order to minimise the risk of failure, Mr Orban will meet Mr Barroso on the 23rd of April and the program will be submitted only afterwards.
There were also wage data from Hungary (gross wage growth was 6.9% Y/Y in February vs 4.3% Y/Y in January) and Poland (3.8% Y/Y in March, down from 4.3% Y/Y in February), they will have only little market impact. Much more interesting could be today’s release of the March industrial output data in Poland, which could be really significant for the next interest-rate decision of the MPC.