Forint struggles on interbank market
The forint was trading at 315.64 to the euro late Thursday on the interbank forex market, down from final quotes at 315.01 on Wednesday. At 315.09 to the euro early Thursday, the forint moved between 313.94 and 315.71, a more than one-week low.
The Hungarian currency struggled to remain stable in a perplexing environment of benchmark U.S. Treasury yields rising and Germans falling with only a week to go until the U.S. rate decision, while stock markets corrected down after three days of rises on gloomy data from China and Japan.
The euro also oscillated between minor gains and losses versus the dollar, without clear direction for most of the day, but shot up late afternoon, leaving the forint also behind as euro-based carry trades apparently thinned out again.
Renewed hopes for a rate hike postponement in the United States following late afternoon data on deepening import price deflation overseas also boosted the euro and the forint in dollar terms.
A strong auction of one-year Hungarian discount Treasury bills with healthy yield drops supported the forint initially, but its effect was counterbalanced with yields rising for the longer tenors on the secondary market. Risk premium of the benchmark 10-year Hungarian sovereign widened to the Bund, but narrowed to the comparable U.S. Treasury.
The forint traded at 279.98 to the dollar, up from 281.09 in final quotes on Wednesday. On Thursday, it moved between 279.96 and 281.63, after a six-day high at 278.86 late Wednesday, and another more than three-week low in two days at 282.92 late last Friday.
It was quoted at 288.33 to the Swiss franc, slightly down from 288.28 late Wednesday. Its range on Thursday was 286.96 to 288.51, after a three-week high at 285.09 late Tuesday. Since its crash to an all-time low at 378.49 to the franc on January 15 when the Swiss central bank scrapped its cap of 1.20 to the euro, it reached the highest at 281.07 on February 26.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.