Nice comeback for forint: Fastest acceleration since 2007 on Friday

Analysis

Thanks to the news of some positive economic indicators, the forint regained some ground lost over the past two weeks with its biggest move upward in seven years. On Friday, the local currency had gained as much as 1% against the euro before steadying at around HUF 308.6 to €1.

Many analysts have stated that the latest indicators – and now the re-strengthening forint – are signs that the National Bank of Hungary (MNB)’s easing cycle for the economy may finally be over.

“The surprisingly good economic growth figure indicates that the need for monetary support to the real economy has receded,” Concorde Securities economist János Samu was quoted by Bloomberg news service as stating. “The recent spike in forint volatility could provide another reason for ending the rate-cut cycle.”

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