Analyst: Forint's slide not yet a concern
Although the Hungarian forint is trading around 320 to the euro, nearing record lows, there is no cause for serious concern, Gergely Pálffy a foreign exchange analyst of Buda-Cash Brókerház, told the Budapest Business Journal today.
“The forint can worsen further to the euro, reaching 324 as in the beginning of 2012, or even weakening to 330,” Pálffy said. "The most important question is how the National Bank of Hungary will react to the changes of the foreign market — the slackening of the European Central Bank and the tightening of the U.S. Federal Reserve.”
As long as the forint does not start to drop as dramatically as the Turkish lira or the Russian ruble have done recently, the economy should not be heavily impacted, he added.
In fact, according to Pálffy, the weak local currency can be beneficial for companies that manufacture products chiefly for export.
He said that the low forint could also draw tourists to western Hungary, but noted that, since many of the tourists going there have come from Russia and Ukraine, hopes for increased visits are currently undermined by the Ukraine crisis.
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