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30th August, 2019

Forint sinks to all-time low

The forint may sink further, analysts said on Thursday, as the currency weakened to a record low of 331.85 per euro.

There is no threshold in sight that could prevent further weakening, according to analyst Zoltán Varga of Equilor brokerage.

Currencies across Eastern Europe also weakened, as there is a recent capital withdrawal from these markets.

Reports that the European Central Bank is expected to renew its quantitative easing policy of buying financial assets in developed markets induced a capital outflow from emerging markets.

The forint could fall to 335 per euro soon and to 340 in two or three weeks, Varga forecast.

Any intervention by the MNB would be pointless, he added, as the weakening is part of a regional phenomenon.

The MNB’s confirmation that it has no exchange-rate target might provide an invitation for speculators betting on a weaker forint, observed bond trader Péter Kiss of fund manager Amundi.

Sources regularly consulted, with abbreviations used in text: Népszabadság (N); Magyar Hírlap (MH); Világgazdaság (VG); Napi Gazdaság (NG); Magyar Nemzet (MN); Népszava (Nsz); Kossuth Rádió news (KR); nightly TV news (TV).

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