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Forint slides above 360 per euro as easing-cycle risk looms
With the Forint back above 360 against the euro, markets are looking to the Magyar Nemzeti Bank MPC minutes for clues that rate cuts could become more conditional.
Commerzbank’s Tatha Ghose said the Hungarian Forint has given back recent gains as external shocks and the Magyar Nemzeti Bank’s easing cycle have weakened support for the currency.
FXStreet reports that the Forint is trading above 360 versus the euro, and traders are waiting for the Monetary Policy Committee minutes to assess whether the central bank’s rate-cut stance could be framed more conditionally, which would help limit further downside and support foreign exchange stability.
Ghose said the July guidance from the MNB suggested room for additional rate cuts during the summer before reassessing in September, a message that can sound relatively unconditional and reduce interest-rate support for the Forint, even as the balance of inflation risks has shifted.
A more conditional tone in the MPC minutes, according to the bank, could reassure markets that the MNB may move away from the rate-cutting cycle, reinforcing its long-standing focus on maintaining foreign exchange stability.