The Central Bank of Hungary today added a "tolerance band" around its inflation target in a bid to increase the flexibility of its monetary policy.
The central bank will continue to pursue a 3% target for CPI inflation over the medium term, but will now tolerate deviations from the target of plus or minus one percentage point.
The use of a tolerance band will contribute to the flexibility of monetary policy, the central bank said, recognising that exogenous shocks may knock inflation off target
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