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Shocking: Forint plunges after Trump calls Zelensky a dictator
In recent days, the forint has suffered a significant depreciation, mainly due to Donald Trump’s statements. The former US president’s sharp criticism of Ukrainian President Volodymyr Zelensky has fuelled geopolitical uncertainties. This uncertainty quickly spilled over into financial markets, with emerging market currencies, including the Hungarian currency, being particularly affected.
Trump called Zelensky a dictator and criticised Ukraine’s war strategy, which immediately heightened investor caution. According to Ellenszél, such political pronouncements often lead to a surge in demand for safe-haven currencies such as the dollar, while currencies considered riskier, such as the forint, weaken. The euro has not escaped the turbulence; it has also depreciated against the dollar due to the impact on the European economy.
The Hungarian Prime Minister recently said that the euro could soon fall below the 400-forint level. As 24.hu reported, Viktor Orbán was optimistic about the forint’s situation in a Facebook video, pointing out that preparations for peace talks and falling gas prices could stabilise the Hungarian currency. However, as 24.hu noted, market reactions showed the opposite: the forint did not strengthen but weakened, stabilising above the 403 level.
On Tuesday, the forint was still on a strengthening path, reaching a three-month high against the euro. However, Trump’s statement broke this positive trend: by the evening, the euro-forint exchange rate had crossed the 403 mark, while against the dollar, it fell even more sharply to 387.
The vulnerable Hungarian Forint
The weakening of the Hungarian currency is not only caused by geopolitical events but also by economic fundamentals. Inflation remains high, and expectations of interest rate cuts are making markets jittery. Investors are sensitive to factors that increase uncertainty, and the Hungarian economic situation is itself vulnerable.
Trump’s statements were a factor of uncertainty that added to already existing market concerns. The impact of the US political situation is becoming more pronounced in international currency markets, and emerging market currencies are particularly sensitive.
The future movements of the forint will be significantly influenced by the geopolitical situation. If Trump continues to make controversial statements, this could increase market nervousness, leading to further weakening. In addition, the actions of the Hungarian National Bank will be key: without the central bank’s intervention, the forint could come under further pressure.
In the coming days, investors and economic agents will be watching developments closely. If geopolitical tensions ease, this could help stabilise the forint. However, if the political situation in the US and Europe remains tense, further weakening of the Hungarian currency cannot be ruled out. This could pose new economic challenges for Hungary, especially in terms of inflation and economic growth.
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#GoldenAge
Sometimes – History Never Lies – in the MOUTHING off – the Promoting and ADVERTISING – in the case of Victor Mihaly. Orban and Peter Szajjarto – the Fidesz Government of Hungary, in the World “Political Bull Ring” – we KNOW, in there Culture, the use of Falseness – Lies in Propaganda “broad” distribution, that Trump and Hungary – the “Mouthing Off” of a “New & Golden Age” has arrived, never must it be FORGOTTEN – that your CLAIMED closest Friends become your BIGGEST Enemies.
Hungary – it ALL will WORSEN.
We have been SLAUGHTERED as a country, over the course of the (16) years under the Orban led Fidesz Government, that any form of SUSTAINABILITY – in the componentry principally, the Economic & Financial inclusive of our currency, the forint, in Hungary, over-all – it WILL all WORSEN.
So Euro dropped too- so i guess its a wash. We know the killing in ukraine has done wonders for EU- the dollar will continue to increase against the Euro has ftge fighting stops and end the coruption on both sides