Hungarian Forint: Rally against Euro seen extending – ING

ING’s Frantisek Taborsky says Central and Eastern European (CEE) FX is benefiting from positive global sentiment, with EUR/HUF breaking to new lows below 355. Markets expect Hungary’s new Prime Minister Peter Magyar to unlock EU funds and advance Euro adoption. Despite stretched long positioning, Taborsky sees the pair reaching the 350 mid-year forecast earlier, though he warns optimism could fade without concrete fiscal and EU-funds plans.

CEE FX buoyed by Hungary optimism

"Along with all emerging markets, CEE FX is enjoying the positive sentiment coming from the global story."

"EUR/HUF broke another record low last week, closing below 355 on Friday."

"Despite the already heavy long positioning, it seems that the market has no problem moving forward and our mid-year forecast at 350 will probably be reached earlier than we expected."

"On the other hand, the appointment of the PM itself may herald the end of positive headlines and the market may buy the rumour and sell the fact."

"Therefore, we believe that the market can ride the wave of optimism for a while longer before it starts to address the details here."

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