01 March 2013

HUNGARY / EU : Controversial Matolcsy Named C.Bank Chief.

     As widely rumored...and expected...PM Viktor Orban named controversial Economics Minister Gyorgy Matolcsy...as new central bank chief...replacing opponent Andras Simor in June.
     Matolcsy, 57...is a close Orban ally...and gives the PM more control over the bank and fiscal policies...during a 6-year term.
     To the EU's dismay...Matolcsy has imposed windfall taxes on telecoms, banks and retailers...and nationalized billions of private pension funds.
    Orban has downplayed austerity measures...and tried to stoke growth....by cutting the benchmark interest rate to 5.25%
    The likely prospect of Matolcsy's appointment has weakened the forint for weeks.
    Budapest and the IMF have argued for months over billions in new loans.