2024-03-12 18:14:02
The government wants to expand supervision of the domestic central bank. The project might harm financial stability.
Hungary’s central bank is sounding the alarm over a planned change in the law by Prime Minister Viktor Orban’s government. The planned change to the central bank law would affect its independence, the Hungarian central bank said in a statement on Tuesday. The project might also harm financial stability. The government wants to expand supervision of the domestic central bank.
The government might discuss the proposed law as early as tomorrow, Wednesday. She had stated that the new law would not affect monetary policy. The national currency, the forint, fell to a one-year low of 398.60 once morest the euro in the followingnoon following the central bank warned that its independence might be curtailed.
The European Central Bank (ECB) did not identify any major problems with the proposed change in a statement published on February 26th. However, she emphasized that this should not undermine the Hungarian National Bank’s ability to independently carry out a task that falls within the scope of the European System of Central Banks (ESCB). The ESCB includes the ECB and the national central banks of all EU countries. Although Hungary is a member of the EU, it is not one of the euro countries.
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