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Forint further down in global escape from risky assets

MNB

The forint was trading at 307.04 to the euro late Wednesday on the interbank forex market, down from 306.14 late Tuesday. At 306.25 to the euro early Wednesday, the forint moved between 305.84 and 307.39, a five-day low. Last Friday intraday it reached a three-and-a-half-month high at 304.59.

The Hungarian currency continued its slow slide as new, dismal, global economic data fuelled further escape from risky assets to safe ones. It gained some strength, however, in dollar terms, in the wake of a sudden turnaround to the worse of the U.S. currency against the euro. But U.S. yields still continued to fall, slowing the forint's slide in other currencies. The forint has been buoyed recently by comments from the government and the central bank which suggested that they want a stronger forint by the year-end to cut state debt from 2013. Increased market confidence for the Fed to stay put longer than previously thought, and no rate cuts in Hungary, all but pledged by the deputy head of the central bank on Monday in spite of deepening deflation, could still put some floor under the forint and help achieve the debt goal. The forint traded at 240.46 to the dollar, up from 241.83 late Tuesday. On Wednesday, it moved between 237.82, a one-and-a-half month high, and 242.63. It was quoted at 254.13 to the Swiss franc, down from 253.63 late Tuesday. Its range on Wednesday was 253.19 to 254.74, an eight-day low.

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