Already at 375 euros
The forint is constantly coming back against the euro, in the last few minutes the domestic currency has strengthened to levels around 375. Against the dollar, the forint is currently at 348.
Development of the EUR/HUF exchange rate
They pulled back the forint a little, but the dollar is still strong
After the rapid weakening, the forint was able to recover a little from above 377 to around 376 against the euro, and the dollar/forint quote dropped from over 350 to close to 349, but meanwhile the dollar remains persistently strong against the euro. In addition to the tug-of-war around the American debt ceiling, the fact that the latest weekly jobless claim data in the United States published today was lower than expected may also play a role in this, so this increased expectations for another Fed rate hike in June.
According to the latest data, the number of applications decreased by 22 thousand to 242 thousand, while the market consensus expected a figure of 254 thousand. The four-week moving average fell to 244,000 people, and the number of people applying for long-term unemployment benefits fell to 1.8 million people, which is the lowest since March 4. Analysts expected an increase of 11,000 people.
All of this indicated that the American labor market is still tight despite the interest rate hikes, which may still prompt employers to raise wages, so the inflationary risks remained. THE market prices from yesterday’s 28% to 36%, the chance of another 25 bp interest rate hike in June to the 5.25-5.50% range has increased, and this is fueling the dollar’s strength.
They continue to beat the forint, the dollar is starting to get tougher
In the late afternoon and early evening trading, the forint was hit even more, as the dollar strengthened even more against the euro, and this could trigger the closing of more and more carry trade positions on the forint market (which were previously opened to pocket the exceptionally high interest rate, but the foreign exchange market spike in volatility and Hungarian-specific risks do not favor them). The quotation of the euro jumped above 377 in the last few minutes, i.e. the forint fell by 7 units within the day, which corresponds to a 1.8% drop compared to last night. Then there was a quick pullback to 376, but meanwhile the dollar is getting stronger against the euro. It is currently trading at 1.076 after breaking important technical levels at 1.085 and 1.0810 yesterday and today (see our previous posts). The strength of the dollar and the decline of the forint together led to the fact that the daily movement in the dollar/forint exchange rate was once again exceptional: quotations were just above 350, which was unprecedented in a month and a half, and this is a 2.5% intraday means a HUF drop.
They continue to beat the forint, the dollar is getting stronger
In the last few minutes, the forint received another major blow, as the dollar starts to gain momentum against the euro (it is already at 1.077!), and the quotations for the euro suddenly jumped to 376, and to 349 for the dollar. This means that it is another two-week or one-month forint low. Today, the forint suffered a 1.7% drop against the euro (the zloty only 0.7%, the koruna only 0.3%), while we can talk about a 2.2% decline against the dollar.
The dollar broke another important level
After the dollar broke the half-year rising trend line in the EURUSD around 1.085 yesterday, it is starting to gain more and more momentum amid the US debt ceiling fears. Minutes ago, the exchange rate also broke the 100-day moving average around 1.0810, the quotations fell below 1.08, i.e. the dollar jumped to an almost two-month high. This is yet another unfavorable news for the forint among the emerging market currencies, which does not usually perform well with the increasing strength of the dollar. Against the increasingly strong dollar, the HUF fell to around 346.5, which represents a new one-month low.
The forint continues to fall, and we can already talk about multi-week lows
In the afternoon trading, a new wave of forint fall emerged, so the quotations against the euro rose above the level of 374, which represents a new two-week forint low. In the meantime, the dollar stuck at persistently stronger levels near 1.08 against the euro, so the forint fell to a new one-month low of 346 against it.
The forint fell by 1.2% today, the zloty by 0.6%, but if we look at the last two days together, we can see that the degree of weakening is roughly the same, so the regional performance of the forint does not stand out. , more precisely, after the great march of the previous weeks, the forint-zloty pair is now weakening together. The weakening of the Czech crown has already started a few days ago.
The euro hovers around 373
In the past hour, the forint has been sideways at around 373 against the euro, i.e. the sudden fall of the forint in the morning has stopped, but there is no substantial recovery either.
Meanwhile, the dollar is persistently moving at stronger levels against the euro around 1.0810 after yesterday’s trend break. Now the 100-day moving average is holding the exchange rate for the time being. Thus, due to the strength of the dollar and the weakening of the forint, the dollar/forint quote rose to 345, which represents a one-month forint low.
The fall of the forint has stopped, but there is no recovery either
In the past hour, the exchange rate of the forint against the euro has stabilized around the level of 373, so there is no recovery after the rapid fall in the morning. According to the signs, after the upward breakthrough of the falling trend line indicated in the previous posts (at 372.3), this is already preventing the strengthening of the forint. The dollar exchange rate is currently hovering around 345 on the interbank HUF market.
They continue to beat the HUF
The forint’s sudden morning/afternoon drop continues: the euro is already above 373, i.e. the short-term downward trend line drawn below has been broken by the exchange rate around 372.3, thus opening the way for a further forint drop. The dollar exchange rate is already around 345.
They started to hit the forint, it has already reached an important level
After a stable start in the morning, the forint began to hit and the euro jumped above 372 in a short time, i.e. the forint is already weaker than when yesterday the Minister of Foreign Affairs and Trade Péter Szijjártó announced (we are blocking the 11th EU sanctions package and the payment of the peace framework by the Ukrainian OTP until it is removed from the list) the Hungarian currency was suddenly struck. At the same time as today’s fall, the exchange rate began to test the downward trend line drawn around 372.3, and if the exchange rate goes up through it, further space will be opened before the forint fall.
The situation and market perception of the forint is also made less favorable by the fact that the EURUSD broke an important level yesterday, the importance of which we already drew attention to in our technical analysis on Monday. The breakout opened the way for further dollar strengthening, although now the 100-day moving average (blue line) keeps the exchange rate around 1.0810. If it also fell, then an even more serious strengthening of the dollar could begin, up to around 1.05.
Due to the strength of the dollar and the weakening of the forint, the dollar/forint quotations also swung upwards: they are now trading at 344 on the interbank market.
In addition to the forint, the zloty and the koruna are also weakening against the euro today. As can be seen in the relative performance diagram below: the weakening of the koruna has been going on for days, the zloty’s decline started yesterday after the great march of the previous days, so now regional effects are also leaving their mark on the forint’s performance.
They only scared the forint a little, it remained around 370
The forint is around 370.13 against the euro on Thursday morning, which means a 0.2 percent weakening from the point of view of the Hungarian currency. On Wednesday, the quote was also around 372 after Foreign Minister Péter Szijjártó announced that the Hungarian government will not support further sanctions against Russia or aid to Ukraine as long as Kiev considers the OTP among the organizations financing the war. With this, the conflict between the Hungarian government and the other European countries may intensify again, which is negative from the point of view of the forint. In the next few days, investors will pay attention to next Tuesday’s interest rate decision, the Monetary Council of the MNB may even start reducing the 18 percent key interest rate now. And this can significantly influence the exchange rate of the forint. Against the dollar, we are now at 341.77, while the British pound costs HUF 426.34.
Development of the EUR/HUF exchange rate
Among the forint’s competitors in the region, the Polish zloty started the day with stagnation and the Czech koruna with a minimal weakening against the euro. In the emerging market, the Turkish lira is starting the day with minimal weakness against the dollar, while the Russian ruble is down 0.2 percent.
The euro-dollar exchange rate does not show any major movement for the time being either, the quotation is now around 1.0832, which means a 0.1 percent strengthening of the dollar for the time being. The Japanese yen shows a minimal strengthening, and the British pound shows a barely perceptible weakening.
Development of the EUR/USD exchange rate
Cover image: Getty Images
