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HATC SAMPLE EDITION:
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5th March, 2024
Forint weakens, as divergence from zloty widens
The forint weakened at one point to 396.80 per euro yesterday, hitting a 12-month low not seen since March of last year.
Later in the day, the currency climbed back to 394.80 per euro, a level still 0.2% weaker than on Friday.
Announcements later this week are expected to bring major changes in the foreign-currency market in Hungary, as the GDP figures will be released today and inflation data on Friday.
In a report on the diverging fortunes of the Hungarian and Polish currencies, the Financial Times (FT) points out that the forint has reached its weakest-ever level against the zloty.
According to the FT, the two countries have taken completely different paths in recent months.
The newspaper notes that Hungary is in dispute with the European Commission, which is suspending payments to the country, while the growing tensions between the central bank and the government have not helped the forint.
In contrast, the European Commission has agreed to unfreeze €137 billion of EU funds for Poland after the government took steps to restore the rule of law.
Moreover, in Poland the central bank has not lowered its base rate, unlike in Hungary.
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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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