The Hungarian forint moved sideways most of the session on Friday as the zloty’s gains and NBH’s Minutes failed to affect the market in a significant way.
Intra-day: the EUR/HUF pair hovered within a tight rage till the release of the Minutes, while it dipped slightly when the Minutes were revealed and domestic bonds reacted to them in a positive way. However, minor forint’s gains were quickly reversed as the rise in the US bonds yields and firming USD weakened sentiment in emerging markets. Hence, EUR/HUF bounced to the 251 area at the end of the session.
Although the domestic eco calendar is empty today, the market already eyes Thurdays release of the January inflation, which might influence the bond market and indirectly the forint too. However CPI figures will not be today’s story and the high-yielding forint may continue suffer due to ongoing bearish sentiment in core bond markets and stronger USD.
(CSOB - Investment research)