Financial market awaits MNB reaction on forint depreciation

History

After a brief recovery Friday, the Hungarian forint depreciated again to 330 against the euro. Meanwhile, the National Bank of Hungary (MNB) indicated that Governor György Matolcsy will not appear before Parliamentʼs Budget Committee on Wednesday.

On Monday morning the forint positioned at 329.2 against the euro, but shortly after weakened again to 330, and to 283.8 against the U.S. dollar.

In an analysis released on Monday morning, Erste Bank indicated that the forint could further weaken if the communication of the central bank or international sentiment do not change, business site portfolio. hu reported.

Last week, Matolcsy was summoned to appear before Parliamentʼs Budget Committee on July 4 in order to provide an explanation for the depreciation of the currency. In a response issued on Friday, the MNB said it is the parliamentary Economic Committee which, under the law, has the right to hear the governor of the MNB.

As reported by national news agency MTI, the MNB claimed in its statement that László Varjú, chairman of the Budget Committee and an MP of the opposition DK party, initiated the hearing "without knowing the central bank act, solely for political gain, while the central bank act clearly states that the primary goal of the MNB is reaching and maintaining price stability."

The MNB governor regularly provides information to the plenary session of Parliament and has accepted the invitation of the Economic Committee on every occasion, in line with the central bank act, the statement added. It is the chairman of the Fiscal Council who is entitled to comment on the 2019 budget bill, in line with the stability law, it noted.

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