EUR/HUF: Downtrend extends with key supports – Societe Generale

Societe Generale analysts expect no change by the MNB today at 6.25% and describe EUR/HUF extending its decline after failing above the 200‑day moving average in March, with an interim low near 360. They see the February low around 374 as initial resistance on any rebound and project further downside towards 357 and 353 if 360 fails, while expecting medium‑term appreciation toward 340‑350 as Hungarian risk premia compress.

Stretched downtrend and projections

"In CEEMEA, we pencil in no change by the MNB today at 6.25%. Headline CPI rebounded less than estimated in Hungary to 1.8% yoy in March from 1.4% in February but geopolitical risks and the stickiness of oil prices imply that room for policy manoeuvre is scarce in the near-term. "

"The exit of PM Orban and the absolute majority in favour of TISZA party support our forecast of 340-350 for EUR/HUF over the medium term. HGB yields and rates are expected to compress across the curve, especially at the long end where the risk premium reprices as optimism returns about growth and the release of EU funds."

"EUR/HUF has extended its decline after failing to establish above the 200‑DMA in March. The pair has experienced a sharp down move recently, carving out an interim low near 360. The daily MACD is deep in negative territory, signalling a stretched downtrend; however, signals of a reversal are not yet visible."

"Should a short‑term rebound materialise, the February low around 374 is likely to act as initial resistance. A failure to defend 360 may result in persistence of down move towards next projections at 357 and 353."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)