CEEMEA Economics & Strategy Daily: Hungary CPI, NBR rate decision and forecasts

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11 Aug 2026 06:23:21 ET │ 15 pages

CEEMEA Economics & Strategy Daily

Hungary CPI, NBR rate decision and forecasts

CITI'S TAKE

Crude has rallied more than 14% from the August 5 lows in a steady, lowvolatility move, reflecting renewed supply risk concerns as hopes for a

definitive US-Iran deal fade. The weaker NFP print has prompted

comparisons with the post-February payrolls episode in March, when

markets aggressively repriced the Fed path. While the parallels are

understandable, we see important differences between the current

backdrop and March that suggest a less straightforward rates reaction

function this time.

Global Macro – Crude has risen more than 14% since the lows on the 5th of August

in a steady and reasonably quiet up-move, as flows seemingly get nervous once

again in the absence of a more decisive move towards a US-Iran deal. The price

action post lower NFP triggered many discussions with clients who compared the

US rates reaction function to the one seen in early-March (following the negative

February NFP). We would highlight two major differentiating factors between

now and then (March 2026): 1) ESIs are in a much more pronounced move to the

downside compared to the seesaw in ESI back in March. This suggests better

directionality of output, potentially capping nominal rates. 2) The data

sequencing in March was not ideal - after the deeply negative NFP, investors saw

slightly higher retail sales and CPI print in-line with consensus, with real average

hourly earnings ticking higher at 0.4% MoM (AHE dipped in the last payroll

report). All that said, we are talking about factors which could cap front-end and

belly, not necessarily the back-end. We believe the back-end could be preparing

for another negative surprise in the coming months, unless oil price action

manages to erase a lot of the risk premium being built in this part of the curve.

Depending on the equity response to these developments, EM risk may respond

in a heavier way - as 60/40 portfolios and risk parity funds start to suffer. Such

price action may directly impact curves like CE and back-end ZAR. We are

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