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Breaking news: Hungarian price caps remain in place until 30 June
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The government has decided to maintain the current cap on the price of certain products until June 30, Gergely Gulyás, the head of the Prime Minister’s Office, told a regular press briefing on Thursday.
Referring to the war in Ukraine, Gulyás said that “as long as there is war and sanctions, there will be inflation”, adding that the government was committed to reducing inflation to single digits by the end of the year.
Gulyás welcomed a recent central bank statement that the Monetary Council could decide next week to lower the upper threshold of the interest rate corridor. He hailed the move as “the first sign that could indicate lower inflation“.
On the subject of the war in Ukraine, Gulyás said avoiding the involvement of NATO in the conflict was in the entire world’s interest, arguing that such a scenario would lead to a world war and a nuclear war.
Hundreds of thousands have died in the war so far, and more and more weapons are making their way to the frontlines on both sides, indicating a protracted war for the foreseeable future, Gulyás said.
He said steps that escalated and extended the conflict were “irresponsible” because they posed the risk of a nuclear war.
The Hungarian government is unwaveringly on the side of peace, Gulyás said, noting that it did not send weapons to the war or allow the transit of weapons deliveries through its territory.
On another subject, Gulyás said farmers will not be charged for the water they use to irrigate their land this year. He said the government was committed to reducing the damage farmers suffered due to last year’s droughts, and it would pay for farmers’ water consumption.
Gulyas starts by saying that the government wants to reduce inflation. He finishes by saying he wants to stop lower priced Ukrainian agricultural products from coming on the Hungarian market which would reduce food prices. Fidesz wants to suck and blow at the same time. Price caps on gasoline resulted in a 20% increase in consumption of last year which then resulted in shortages and closed petrol stations (retailers didn’t want to lose money on their sales) and petrol now costs more than in neighbouring countries. Price caps have been historically proven to be counter-productive and the government is to blame for the highest inflation rate in Europe caused in large part by price caps which distort the market economy.