Forint breaks 250 barrier against Swiss franc

MNB

The forint fell sharply on Tuesday's interbank market, trading at 271.57 to the euro late night local time, compared to a rate of 268.73 on Monday evening.

The forint was trading at an all-time low of 250.95 to the Swiss franc late night on Tuesday, falling sharply from a rate of 242.08 at around 6:00 p.m. on Monday. 

Dealers attribute the forint's weakening to a rise in risk-aversion stemming from concerns among traders that the euro-zone debt crisis may be spreading to Spain and Italy and that the US could lose its AAA credit rating in spite of raising its debt-ceiling.

The forint also weakened against the US dollar on Tuesday, trading at 191.19 late evening, compared to a rate of 189.10 at around the same time on Monday evening. 

Answering a question after a meeting of rate-setters on July 26, National Bank of Hungary governor András Simor said stress tests the central bank conducted last October showed the country's banking system was resilient enough to withstand a strengthening of the Swiss franc to HUF 245 at the end of 2011 and to HUF 257 at the end of 2012.

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