It seems that the downgrade of Hungary’s sovereign rating by Moody’s, which
came on December 22, did not change investors risk appetite and the forint continues
to rally. The Hungarian currency yesterday in spite of lack of domestic as well as
external impetuses firmed and reached a new 10-month high at EUR/HUF 250.85.
Today again the economic calendar is empty. Although we still believe that current
values of the forint do not correspond with Hungarian macroeconomic fundamentals
and that the correction is very likely in coming month, we believe that today the positive
mood on the Central European markets might continue and thus the forint is
likely to firm and test its technical barrier at EUR/HUF 250.0. From global markets’
statistics, the US ISM will be interesting. If the ISM remains below 50, which is according
to our view is likely, the CE region might receive additional positive stimuli.
(CSOB - Investment research)