Yesterday the trading with CEE currencies was mixed. While the Polish zloty eased by 0.3% on dovish comments of the central bank member Andrzej Bratkowski, the Czech koruna remained stable ahead of tomorrow’s CNB meeting. On the contrary, the Hungarian forint firmed to one-week high against the euro after the Hungarian central bank did not surprise the market and cut rates by 25 basis points to all-time low of 5%. Due to the mixed reputation of new NBH governor, who is known as close ally of Prime Minister Viktor Orbán and a supporter of unconventional policies, the uncertainty around future course of monetary policy is extensive. In addition Monday’s decision to cancel regular press conference after rate setting meeting intensify concerns about NBH transparency. Nevertheless it seems that at least for now policymakers are constrained by the threat of the forint weakening and did not afford to cut rates more. Neither the monetary council statement surprised. It stressed weak domestic demand together with low inflation as main arguments for further monetary easing. The NBH sees inflation to remain under the Bank’s target untill the end of 2014. Exports are likely to remain the most important source of growth and recovery in domestic demand is unlikely before 2014 according to NBH. That sounds as pretty realistic view.