The Hungarian forint did what only a few experts believed it would do: it broke the 375/EUR level this week.
According to Portfolio, the forint could leave the 380/EUR level behind and reached 374.6/EUR this week. The Hungarian national currency performed well against the USD as well. Last year, it broke historic lows one after the other, but now it stands at 344/USD. That is a HUF 106 strengthening against the dollar compared to last October.
According to a chart of tozsdeasz.hu, the forint reached an annual peak against the euro this week. The last time it was around 370/EUR was March 2022.
Tőzsdefórum argues that the very high base interest rate set by the Hungarian National Bank is the reason why the forint keeps strengthening. However, the American bank closures showed the currency remained vulnerable to external effects. Thankfully, Barnabás Virág, the vice-chairman of the MNB, announced that the high interest rates would remain. He added that it would be difficult to reach the one-digit inflation aim of the government by end-2023.
Experts said that multiple factors affect the currency exchange rate of the forint. Among others, the EU funds, the monetary policy of the national bank, the macroeconomic environment and even the US FED interest rate policy and communication.