Budapest - Hungary's national bank sharply raised interest rates Wednesday in an emergency bid to defend the country's currency, which has slumped as a result of the global financial crisis.

The bank's policy-making council boosted the key rate to 11.5 per cent from 8.5 per cent at an unscheduled meeting in Budapest, a central bank statement said.

The forint has plunged in recent days as concern about the liquidity of Hungarian banks soured investors on the Central European nation's already ailing economy.

Washington - The International Monetary Fund (IMF) is investigating possible abuse of power by its head, Dominique Strauss- Kahn, in connection with a sex liaison with an underling of Hungarian origins, the Wall Street Journal reported Saturday.

The 59-year-old French economist and socialist, married to French television journalist Anne Sinclair, was named last year as IMF director.

Budapest- Hungarian Prime Minister Ferenc Gyurcsany on Saturday called for a "national pact" to combat the effects of the ongoing financial crisis before a meeting of national leaders.

"Hungary is navigating in the middle of a storm in rough waters," Gyurcsany said at a meeting of past and present leaders and politicians.

Gyurcsany's plan seeks national consensus for a plan to bring Hungary into the eurozone, finance pensions in the future and reform the public finances.

Budapest - The European Central Bank has agreed to lend Hungary up to 5 billion euros (6.8 billion dollars) to help ease credit conditions, the ECB said Thursday.

The accord will help Hungary's central bank provide extra euro liquidity in the East European nation, the Frankfurt-based ECB said in a joint statement with the Hungarian Central Bank.

Euro-denominated loans are a key source of finance in Hungary, which joined the European Union in 2004 but has not switched to the euro.

Hungary's currency, the forint, regained some of Wednesday's losses against the euro after the announcement.

Budapest- Hungary's minority socialist government has opted against a planned moderate tax reform in light of the global financial crisis.

A legislative proposal introduced last month was withdrawn Monday after a meeting of the Hungarian parliament's committee for rules and internal procedures.

The reform would have lightened the tax load on citizens and businesses by 150 billion forints (810.9 million dollars) starting in 2009. Experts had called the planned step insufficient to boost Hungarian businesses, which have long complained about their heavy tax burden.