Hungarian forint among the world’s worst-performing currencies

The Hungarian forint reached historic lows against the USD, the EUR and the Swiss franc in the last few days. The reason of the bad performance is probably the National Bank of Hungary, which did not raise the base rate this week as experts expected. In one feature, the forint is one of the worst-performing currencies in the world, preceded even by the Mexican peso or the Polish zloty.

In the first nine months of 2022, the Hungarian forint weakened the most against the US dollar among the world’s currencies, Portfolio reported. You may find the relevant chart explaining the situation in their article. Interestingly, the Russian ruble strengthened against the US currency. However, that does not reflect its market value since trade is no longer free with the Russian currency because of the Western economic sanctions and the Kremlin’s tightened capital control.

According to Portfolio’s chart, the only currencies that performed against the dollar worse than the forint were the Ukrainian hryvnia, the Argentinian peso and the Turkish lira.

Read alsoThe Hungarian forint’s newest historical low against the dollar

The value of the American dollar increased because of the recent decisions of the FED, experts agree. DXY, the so-called dollar index, compares its value against a foreign currency basket. It raised 17 percent this year.

As we reported before, experts agree that the future value of the forint is in the hands of the government. If the Orbán cabinet can foster an optimistic statement from the European Commission regarding Hungary’s accessibility to the billions of euros in the RRF and other funds, the forint may start to strengthen. Otherwise, it will remain vulnerable to foreign and domestic decisions like the base rate hike of the Central Bank of Hungary. Probably that is why the rate of Hungarians who would like to introduce the euro instead of the forint grew in the last few months.

Read also2/3rd of the Hungarians want euro instead of forint

Source: portfolio.hu, DNH