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Forint holds near key EUR/HUF levels as MNB rate cut eyed

Societe Generale expects Hungary’s central bank to cut the base rate by 25 bp to 5.50% today, with dovish guidance and softer inflation seen as supportive of further easing.

Reported · Written up by our desk · Major Pairs

Societe Generale strategists said Hungary’s Magyar Nemzeti Bank is widely expected to deliver its fourth consecutive 25 basis point rate cut today, taking the base rate to 5.50%. The call is backed by dovish July meeting minutes and inflation that came in below forecasts, leaving room for more easing.

On the currency side, EUR/HUF has pulled back to around 362 after failing to push above the 368 area, with 359 to 358 identified as the first support zone. The analysts flagged that a hawkish surprise could push the pair back toward 360.

Societe Generale also pointed to levels that would signal a stronger rebound. A break above the 200-day moving average near 371 would be needed to revive the broader recovery, while a breakdown below 359 to 358 could lead to resumption of the broader downtrend.

The note said EUR/HUF has rebounded steadily since an interim low near 348 in June, but clear signals of a larger upside move are not yet visible.

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