Hungarian parliament committee endorses Matolcsy’s renomination as central bank governor

Parliament’s economic committee on Tuesday approved the renomination of György Matolcsy to head the National Bank of Hungary (NBH) for a second term.

The nomination was approved with 10 votes in favour and 5 against.

Matolcsy told the session that over the past six years he had been successful in fulfilling the requirements of his mandate and had contributed to Hungary’s “exceptional growth turnaround”.

All of Hungary’s micro and macroeconomic indicators show a favourable situation, he said, adding that this was in part thanks to the work of the NBH.

The central bank’s interest policy has saved the state budget 2,400 billion forints (EUR 7.5bn) in interest payments, Matolcsy said.

He said the NBH had achieved “price stability”, keeping the consumer price index in a +/- one-percentage-point tolerance band around the 3 percent mid-term target; the central bank had ensured the financial stability of the country; and it had helped to implement the government’s economic policy.

He said convergence had been marked due to the strong pace of growth: investments rose by 40 percent and consumption climbed 20 percent, supported in large part by the NBH’s Funding for Growth Scheme. If there had not been a strategic alliance between the government and the NBH during the period, this growth spurt would have failed to materialise, he added.

“The NBH has been judged many times in the past six years for overstepping its mandate. This is incorrect because supporting the economic policy work of the government is among the tasks of the central bank,” he said.