"Global investor sentiment has turned bleaker again with sellers ruling the capital markets, which makes it no wonder that Hungary’s forint has rowed to darker waters. The HUF has not been as weak this year as its opening level on Tuesday.EUR/HUF kicked off today’s trading north of 273, which marks yet another record low for the HUF in 2010. The forint eased to around 272 on Monday. It has depreciated 2.2% over the past week.
Considering how dim the investor sentiment is presently, it is no wonder that the forint’s not doing so great. While US stock indices closed the day with gains, their Asian peers booked losses. The pessimist mood was fuelled by unfavourable news from China’s banking sector, as according to certain reports, some banks in China have put an end to extending new loans.
The euro’s easing versus the US dollar (to around 1.4080) is yet another evidence to higher risk aversion. Meanwhile, Japan’s yen has depreciated to levels not touched since April 2009.
Also we need to remember that macro data in the morning - Germany’s IFO economic sentiment index - and in the afternoon - S&P Case-Shiller Composite-20 - are prone to affect sentiment today.
The HUF was an underperformer in the region yesterday, being the only currency that suffered losses to the EUR. Meanwhile, trading on the fixed-income market was quiet, as the cloudy global mood prevent Hungarian assets from gaining, a primary dealer told Portfolio.hu yesterday."
Source: Portfolio Online Financial Journal
26.01.2010