Forint mixed on interbank market

MNB

The forint was trading at 313.65 to the euro late Thursday on the interbank forex market, up from 314.18 late Wednesday. Also at 314.18 to the euro early Thursday, the forint moved between 312.94 and 315.60, another almost three-year low.

After falling till early afternoon in the wake of a statement by the governor of the central bank, the Hungarian currency was underpinned in euro terms by the stronger dollar versus the common currency.

The National Bank of Hungary (MNB) has no exchange rate target and is not compelled to intervene to stop the currency's weakening, and the central bank's international reserves provide appropriate protection, the central bank governor said at a joint press conference with the prime on Thursday morning.

Later, a sudden price rise of Brent helped as it was seen as lessening incentive for the NBH to resume base rate cuts soon.

Also helpful was the Swiss central bank's announcement on introducing negative deposit rates, which slowed the flight of capital to safe havens from emerging market assets.

A global re-flow of funds into shares also caused the syphon effect of top-rated sovereign debt seen this week to ease, reflected in rises of both Bund and US treasury yields, while Hungarian sovereign yields fell.

The forint traded at 255.54 to the dollar, down from 254.54 late Wednesday. On Thursday, it moved between 253.86 and 257.18, a new more than twelve-year low. It was quoted at 260.57 to the Swiss franc, up from 261.60 late Wednesday. Its range on Thursday was 259.06 to 261.98, after a near 2.5-year low at 262.68 on Wednesday.

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