The Hungarian Way- Targeted Central Bank Policy

4 900 Ft


The Magyar Nemzeti Bank published ‘The Hungarian Way – Targeted Central Bank Policy’, the third volume of a series of books dealing with economics and monetary policy, in 2017. The book was edited by Kristóf Lehmann, Head of the Bank’s Monetary Strategy Department, and by Dániel Palotai and Barnabás Virág, two of the Bank’s Executive Directors. The Bank’s statutory duties include to enhance domestic financial literacy, thereby promoting economic thinking, and, without prejudice to its primary objective, to support the government’s economic policy. The decision to launch the special series was made in line with this policy mandate.

Acting in accordance with its statutory duties, in ‘The Hungarian Way – Targeted Central Bank Policy’ the Magyar Nemzeti Bank gives a detailed account of the policy measures taken since 2013 as well as their effects, while providing a comprehensive overview of the changes in central bank practices over the past decade. The importance of the book lies in the presentation of the significant and lasting results of innovative, adequately targeted or, as they are sometimes viewed, unconventional, domestic central bank measures in the economy. Taking into account the idiosyncrasies of the economy and the experiences of the crisis prompting a paradigm change, the targeted instruments have proved efficient in addressing the severe challenges facing the Hungarian economy and the financial system, successfully complementing the traditional policy approach.






Summary of key conclusions

Part I- An unconventional crisis with unconventional consequences- finding new ways in international monetary policy

A: Concequences of the global crisis for international monetary policy

1.The 2008-2009 crisis and the new international economic enviroment

2.The impact of new economic approaches on the conduct of monetary policy

B: The new instruments of large central banks- Balance sheets in focus

3.The Fed’s monetary policy after the crisis

4.The ECB in new territory- „Whatever it takes”?

5. The Japanese centralbank’s fight against deflation

Part II- Challanges and answers in Hungarian Monetary Policy

A: Complex challanges for the Hungarian economy and Hungary’s monetary policy

6.Macroeconomic conditions in the first decade of the 2000’s

7.Interactions between fiscal turnaround and monetary policy

8.The way from unsustainable indebtness and vulnerable, pro-cyclical banking system to financial stability

B: Targeted and innovative answers of HUngarian monetary policy to new challanges

9.Easing cycles- significant easing with gradual and cautious steps

10.Theoretical background of maitaining the level of the base rate for an extended period- monetary policy in a world of uncertanty

11.Towards a more flexible framework of inflation targeting

12.Targeted lending incentive instruments: for FGS to GSP

13.Monetary policy considerations for the conversions of foreign currency loans: growing stability and central bank leeway

14.Self-financing programme- central bank tools to reduce external vulnerability

15.Development of BUBOR and the domestic interbank market

16.The limitation of the 3- month deposit as unconventional easing and related modifications of other central bank instruments

C: Hungarian instruments to improve the functioning of the monetary policy transmission mechanism

17.Steps towards a more efficent banking system

18.Development and modernisation of payments and financial infrastuctures

19.Relationship between monetary policy and stock exchange


Part III- Changes in the Hungarian regulatory policy

A: Macroprudential policy in the foreground

20.The theoretical basis of using macroprudential intruments

21. Targeted Hungarian macroprudential policy instruments in practice

B: The emergence of the resolution function

22.The MNB as the resolution authory

C: Reforming supervisory policy

23.Strengthening synergies with the emergence of central bank supervisory functions- The common directions of supervision

24.Overhauling the Hungarian microprudential supevision

25.Market surveillance and consumer protection procedures

26.Supervision in the 21st century and the challanges of digital progress


List of acronyms

List of charts and tables

További információk

Tömeg 2,366 kg









Lehmann Kristóf , Palotai Dániel ,Virág Barnabás




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