Hungary keeps rates on hold - as expected

As expected by analysts the National Bank of Hungary, the country's central bank, kept its policy rate unchanged today at 7.75% after its monthly review of interest rates.

In June the central bank made an unexpected cut of a quarter percent, the first cut for almost two years. That was viewed as the start of a cycle of monetary loosening which will probably result in the key rate falling to 7% by the end of 2007.

In 2006 the National Bank had to raise rates rapidly to hold inflation down at a