World Economy

ECB Set for Final Rate Hike as Hungary Pauses Cuts and Adjusts Inflation Target

The European Central Bank is expected to raise interest rates next week in what economists view as the final increase in its monetary tightening cycle. This represents a significant divergence from market expectations for continued hikes. Hungary's central bank is preparing to pause its interest rate cuts later this month while lowering its inflation target to 2.5%, which is the highest in the European Union. The forint strengthened against the euro following the Hungarian policy announcement. The contrasting monetary approaches reflect different central bank priorities. The ECB's anticipated move signals a potential shift toward stability after months of consecutive increases.