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Hungarians rally in support of bank law

Monday 23 January 2012 – by [email protected]

Hungarians rallied in support of the government following the EU’s decision to start legal action against the country if it does not back down on constitutional changes compromising the independence of its central bank.

Thousands of supporters gathered in Hungary on Saturday to support ruling party Fidesz which is currently seeking a compromise with the European Commission.

On Friday, Prime Minister Viktor Orban indicated that he was willing to reach a compromise, saying he will probably back down on a controversial move to merge the country’s central bank with its financial market regulator.

Among other things, Hungary’s new laws will prevent the bank’s governor from having the power to choose his two vice-presidents, and will instead empower the Prime Minister to select three deputies, which the commission says is not compatible with EU law.

But over the weekend Hungarians came out in support of the new laws, saying they do not want to be “a colony” and that they are fully supportive of Orban’s changes.

The controversial changes, which have sparked warnings from the European Central Bank, European Commission president José Manuel Barroso and the International Monetary Fund, will also boost the size of the Magyar Nemzeti Bank’s interest rate-setting council from seven members to nine. 

Related articles:

Hungary u-turns on central bank law

Commission launches action on Hungary

Fitch downgrades four Hungarian banks

Hungary threatened on budget deficit

Central bank bid leads to Hungary cut

In recent weeks, the EC and the International Monetary Fund have backed away from talks with Hungary about a further loan to help it through the sovereign debt crisis.

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