By Gergely Szakacs

BUDAPEST (Reuters) – Hungary’s central bank left its base rate steady at the European Union’s joint highest level of 6.5% on Tuesday, as widely expected, with falls in the forint, a rebound in inflation and an uncertain economic outlook making policymakers cautious.

S&P Global said on Thursday that central Europe’s monetary easing campaign had entered a riskier stage, with a higher likelihood of policy missteps due to global economic uncertainty and exchange rate volatility.

The Czech National Bank is also widely expected to leave its main rate unchanged on Thursday, which would mark the first time since Hungary started cutting rates in May 2023 that all four of the region’s central banks have kept rates on hold in the same month.

The latest Reuters poll forecasts project just 100 bps worth of additional rate easing in Hungary and Poland by the fourth quarter of 2025 and 75 bps in the Czech Republic and Romania.

“Most fundamental factors are moving in a direction opposed to monetary easing right now,” Commerzbank economist Tatha Ghose said in a note before the Hungarian rate decision.

“Against this background, there is no reason for (the National Bank of Hungary) to consider re-starting a rate cutting cycle when they have already been on pause in recent months.”

After rate cuts worth hundreds of basis points, risks from wage growth, sticky services inflation, high budget deficits and currency swings amid fears of global trade wars are complicating the policy outlook in central Europe.

At 1302 GMT, the forint traded at 409.25 versus the euro, a touch weaker than 409.1 just before the announcement.

The forint has fallen about 4% since the bank’s latest rate cut on Sept. 24, hitting 22-month lows after Donald Trump’s re-election. It is down nearly 7% against the euro this year, making it central Europe’s worst-performing currency.

The central bank will publish updated inflation forecasts later on Tuesday, reflecting the impact of recent falls in the forint and tax hikes to rein in Hungary’s chronic budget deficit.

(Reporting by Gergely Szakacs; Editing by Christina Fincher)