Hungary's Forint Dives On Monday
- 18 Dec 2012 8:02 AM
The forint exchange rate has broken out of the range Ft 280-285 per euro where it has been trading in recent months, weakening to Ft 288 yesterday. Rumours were that the central bank will not accept bids for its two week deposit facility, although this was denied by the MNB, foreign currency trader Ákos Ruzsonyi of Commerzbank said. Investors hold a total of Ft 4 trillion in this deposit, of which 20% is in foreign hands.
Thus investors naturally became more cautious, he explained. What is more, the monetary council may cut the base rate in its Tuesday meeting, despite the not so rosy global environment, Ruzsonyi added.
It would greatly help the exchange rate if the base rate is kept stable on Tuesday, ING foreign currency trader Róbert Csajbók said.
Global investment bank JP Morgan announced its new forint exchange rate target from Monday to be Ft 299 per euro, based on its chart analysis.
Source: Hungary Around the Clock
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