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Forint broke new record - update

The forint was trading at 228.60/75 against the euro at the close of trade in Budapest on Friday after reaching a new record of 228.00 against the single European currency at around 1:15 p.m. on Friday afternoon.     

The forint strengthened to its Friday-afternoon closing mark of 228.60/75 from a rate of 229.60/70 against the euro on Friday morning and a rate of 229.50/60 against the single European currency on Thursday afternoon. Dealers attribute the forint’s Friday strengthening to a positive global environment and other market factors, characterizing Friday currency trade as quiet.

Dealers add that the forint is likely to resume its strengthening trend next week, with the Hungarian currency having established a new “target” of 227 against the euro. The dollar commanded 144.25/35 forints on Friday afternoon, compared to a Thursday-afternoon rate of 144.60/70.

Government-bond yields tracked the movement of the forint on Friday, rising 2-3 basis points on Friday morning before receding 5-6 basis points on Friday afternoon as a result of the forint’s strengthening. Bond yields had fallen by around 3 basis points by the end of the day on Friday, when the yield on 2011/C government bonds stood at 8.84%, while that on the 2012/C bonds was 8.55%. The 2019/A bond, auctioned at an average yield of 7.92% on Thursday, traded at around 7.84% on Friday afternoon. (MTI-Econews)