Positive prospects: Hungarian forint at a ten-month high
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The Hungarian National Bank pushed the forint to a ten-month high. After Tuesday’s interest rate decision meeting, the Hungarian forint strengthened to below 377 against the euro, the strongest level in ten months.
Hungarian forint at ten-month high
The euro was trading at around HUF 378.5 on Tuesday morning, and above 380 during the day, napi.hu writes. At the time of the Hungarian National Bank’s (MNB) interest rate decision, at 2 PM, the exchange rate was around the 378 level.
The central bank left the base rate unchanged at 13 percent at its second rate-setting meeting of the year, as well as the two sides of the interest rate corridor. This was in line with analysts’ expectations. After that, the forint started to strengthen rapidly, trading below HUF 376.5 against the euro, according to TradingView.
MNB leaves base rate on hold
Hungarian rate-setters decided to leave the base rate unchanged at 13 percent at a regular policy meeting on Tuesday. The Council also decided to keep the central bank’s O/N deposit rate at 12.5 percent and the O/N collateralised loan rate at 25 percent.
The rate-setters signalled an end to the tightening cycle at their monthly policy meeting in September, but said tight monetary conditions would be maintained with a focus on sterilising liquidity and improving monetary policy transmission. On October 14, the policymakers announced a decision to launch O/N deposit quick tenders on a daily basis. The central bank has since offered the liquidity sterilisation instrument at a rate of 18 percent.