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Hungary taps Economy Minister Gyorgy Matolcsy to lead central bank

Matolcsy Gyogy Portrait

Gyorgy Matolcsy

Hungarian Prime Minister Viktor Orban recently appointed Economy Minister Gyorgy Matolcsy, who is well-known for his recent unconventional economic policies, to lead the nation’s central bank.

Orban, who has pressed the National Bank of Hungary to provide more stimulus, said he chose Matolcsy because he would be able to lead the central bank “in the context of the economy as a whole,” The Wall Street Journal reports.

Since taking the post in 2010, Orban’s administration has sought to influence the central bank, which critics say raises questions about the independence of the central bank. Government leaders, however, have denied that they are infringing on the central bank’s independence.

“Since the central bank is independent and its independence cannot be questioned, there’s [only one way] that the central bank can place its operation in the context of the economy as a whole—with the appointment of a person who has seen government work and has experienced it,” Orban said, according to The Wall Street Journal.

Hungary has imposed taxes on banks, large retailers and telecommunications firms and has nationalized private pension funds. Investors have voiced concern that Matolcsy will attempt to implement similar measures at the central bank. Matolcsy said the central bank should consider “all the tools the central bank may use to help growth,” including the experiences of other European central banks.

“The Hungarian central bank has been independent and will remain independent,” Maltocsy said, The Wall Street Journal reports. “But it is part of the Hungarian nation-state, so it is not independent from the Hungarian nation.”

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