Why is the forint weaker early this week?

HUNGARY - In Brief 10 Sep 2024 by Istvan Racz
The forint spent the past one-month period in the state of spectacular stability, the EURHUF hovering in a narrow range between 390-395, a level which everyone appeared to be satisfied with. But starting last night, it suddenly weakened to EURHUF 396-398, which is no big move but a bit unusual. And it was not typical for the region, as the following comparison with PLN and CZK suggests: So, this move appears to be more Hungary-specific. The reason may be the most recent talk by PM Orbán, in the form of a facebook post and a partially leaked speech which he delivered to some representatives of the Fidesz establishment behind closed doors in recent days. Mr. Orbán said basically three things: 1. With Mr. Matolcsy's upcoming departure from the MNB (in March 2025), one of the current ministers of the government cabinet will take over the MNB and another one will take responsibility for the newly merged Economy and Finance Ministries (since 2010, they have merged and then separated these two ministries every once in a few years). This statement is generally understood as finance minister Varga going to the MNB and economy minister Nagy, who already holds the responsibility for the whole of economic policy within the government (the 'economic czar', as they say), will get the re-merged two ministries. 2. The government has the plans for next year's 'peace budget' in the drawers. They will not come forward with it before their planned schedule unless Mr. Matolcsy 'forces' them to do so. Translating this from Orbanspeak to common English: the 'peace budget' is a nickname for the next annual budget plan, which is supposed to imply looser fiscal policies than currently, given th...

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this or its contents.