euro

A Hungarian person had to pay nearly 500 HUF for 1 EUR

Euro exchange

If one does not want any unpleasant surprises, it is worth paying attention. Some ATMs abroad convert HUF to EUR at an exchange rate of nearly 500. 

In Slovakia, 1 EUR was nearly 500 HUF

A reader wrote to pénzcentrum.hu about the unfortunate incident. Last week in Slovenia he suddenly needed to withdraw money, as the IFA can only be paid in cash, and he went to the nearest ATM for EUR 60. Unfortunately, he only found a so-called non-bank ATM, and he was quite shocked at the exchange rate.

He paid HUF 29,227 HUF for EUR 60, even though on that day, 6 July, the average official exchange rate was HUF 409.98.

So it was HUF 77 more expensive as the machine changed it for HUF 487.

Hungarian forint state budget historic lows
Read alsoRecord weak forint: Hungary’s national bank is ready to fight

How could have this happened?

Firstly, one needs to be careful with non-bank ATMs. Not only at home but also abroad. The exchange rate at these ATMs is 10 to 15 percent less favourable compared to banks or street money exchangers. They are actually not money exchangers, but DCCs, i.e. dynamic currency conversion facilities. This means that they provide a kind of convenience service and are, therefore, subject to different regulations. In case of foreign purchases or cash withdrawals, in addition to the local currency, the system also offers the deduction of the amount in HUF from one’s account. The exchange takes place in both cases. Although one does not pay in HUF, when choosing the HUF, the system uses an extremely unfavourable exchange rate from the customer’s point of view. Therefore, in almost all cases, it is worth choosing a deduction in EUR.

Be aware of the costs of ATM use abroad

Before travelling, one should be fully informed about the costs of using ATMs abroad. If someone withdraws money abroad with a Hungarian HUF card, their home card-issuing bank may charge them a significant amount in addition to the handling costs of the foreign bank. Moreover, it is worth checking the current policies of the bank that issued the bank card for purchases and cash withdrawals abroad. For example, there may be more favourable fees for cash withdrawals at foreign ATMs operated by the bank group.

Matild Palace Hotel-Budapest-1
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Even the currency of war-torn Ukraine is outperforming the forint

Hungarian forint

According to some experts, it cannot be ruled out that the price of a euro will slowly rise to 440 forints. Last week, the forint has repeatedly hit its historic lows against the euro. Not even in Bulgaria or Albania is the euro so expensive!

Hungarian forint is doing worse than ever

While even war-torn countries are able to stabilise, Hungary is experiencing a deep downturn, Pénzcentrum.hu reports. The euro is threateningly close to 400 forints. The central bank tried to improve the situation by raising interest rates, but this did not help either, as the forint weakened even after the announcement on Thursday.

Central European currencies

Other currencies in Central Europe have weakened especially since the outbreak of the Russian-Ukrainian war, but none to the extent of the Hungarian currency. In addition to the Hungarian forint, Pénzcentrum.hu looked at the currencies of nine countries to see which weakened the most in the period after January 1st and after the outbreak of the Russian-Ukrainian war.

What they found was the fact that the Hungarian forint is leading the weakening. Our currency has weakened by 11 percent against the euro since the very first day of the year, compared to only 4.5 percent for the Polish zloty.

The V4 countries are also coping quite well with the deterioration of their currencies, which were also weakened by the war. The Czech koruna took a nosedive at the beginning of March, but had recovered somewhat by 7 March.

Ukraine and Russia

It is also difficult to explain why Ukrainians, invaded by Russia in February, have been able to maintain the stability of their currency, writes the newsportal. Evidently, in the weeks after the outbreak of the war, the currency has weakened slightly – close to 33 hryvnias to the euro – and on 7 July, the euro was worth 30.17 hryvnias. This is even slightly better than the figure of 1 January.

On 1 January, the price of a euro was 85 Russian roubles, a figure that rose brutally after the outbreak of the war, to 148 at the beginning of March. Despite the near bankruptcy and technical insolvency, the euro is now below 65 roubles. This is also better than the January figure.

11 percent weakening

What is shocking is that the forint has depreciated by 11 percent since January. Among our neighbours, the Ukrainian currency has even strengthened, the Serbian dinar has strengthened minimally and the Croatian kuna is at 0 percent – neither did it strengthen nor weaken. Of the countries surveyed, only the Polish zloty has depreciated, apart from the forint: the euro is now 4.35 percent more expensive in Poland than it was at the beginning of the year.

European Commission Brussels
Read alsoWill the Hungarian government give in to Brussels to save the forint?

Will the Hungarian government give in to Brussels to save the forint?

European Commission Brussels

The Hungarian government is becoming more accommodating to Brussels’ demands. What is the point of this capitulation? Has the government also realised that the forint cannot be allowed to depreciate indefinitely?

The government is more lenient

When asked by 444.hu what the Hungarian government seems to be more lenient on, a Brussels-based expert replied that it seems to be more lenient on everything. This expert has a good insight into the negotiations between the European Commission and the Hungarian government on the reconstruction fund (RRF).

As 444.hu puts it, there is a lot of money at stake, and very little time left to get it. EUR 5.8 billion of aid is pending and a further EUR 9.6 billion in soft loans. 70 percent of the aid will be lost if the European Council does not approve the Hungarian government’s plan to spend the money by the end of the year.

The Council will have four weeks to approve the Hungarian plan if the Commission approves it first. This means that in any case, the Commission must approve the plan, which Hungary has not yet even submitted, by November at the latest.

The funds would be very important

This money would be very important to the government, especially as it has already spent some of it in advance. For example, it was going to pay for this year’s pay rise for doctors, but it has also started to finance some investments and grants that can be won through tenders.

But just as importantly, Hungary is the only EU member state that would apply for the reconstruction fund, but does not yet have an approved plan – this also contributes to the weakening of the forint. This makes investors see Hungary as riskier than other European countries.

“The government wants to do everything it can to make peace with Brussels over EU funds,” György Jaksity, founder of Concorde Securities, told Forbes.hu. He said that the forint is moving towards the category of play money, but at least the government does not want to kick us out of the EU for the time being. The country would be incapable of adopting the euro and the world would be incapable of sending Russia packing.

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Hungary trade balance shifts to surplus in May

money hungarian forint huf inflation

Hungary’s trade balance showed a surplus in May, after ten consecutive months of deficits, a first reading of data released by the Central Statistical Office (KSH) on Thursday shows.

Hungary, an export-driven economy, had a 135 million euro trade surplus in May.

Exports rose by 27.6 percent year-on-year to 12.116 billion euros and imports climbed 27.2 percent to 11.981 billion euros.

Trade with other European Union member states accounted for 76 percent of exports and 71 percent of imports.

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Breaking: EUR/HUF 410, USD/HUF 400, new historical lows – UPDATE

forint euro bills

The euro rose above 410 forints, while the dollar also broke the 400 mark on Wednesday morning. Yet another historical low for the Hungarian currency.

Shortly after 10.45 AM, the euro rose to 410.68 forints, the franc to 413.83 forints and the dollar to a record high of 401.19 forints, writes szeretlekmagyarorszag.hu.

Minutes later, the forint strengthened minimally to 410.19 against the euro, 412.93 against the franc and 400.33 against the dollar.

UPDATE: There is no stopping – a bit after 3 PM on Wednesday afternoon, the euro had risen above 416 forints, while the dollar had reached 408 forints.

Just before 1:00 PM, the euro crossed the 412 forint mark and the dollar was above 403 forints.
After 2:00 PM, the euro rose to over 413 forints, while the forint continued to weaken against the dollar, which was strengthening significantly on the international market, hvg.hu reports.

Read alsoForint at new lows against the euro, dollar and Swiss franc! – UPDATE

When will Hungarians pay 450 Forints for 1 Euro?

Hungarian forint currency change

According to financial analysts, we can likely pay 450 forints for a euro as early as December this year. But what is the reason behind it? And which is the best and worst-case scenario for the upcoming period?

The Hungarian Forint significantly weakened against the major currencies in the interbank foreign exchange market on Monday. The euro was quoted at 402.46 forints at 6 p.m. after 400.23 forints in the early morning, the dollar was quoted at 385.70 forints from 383.85 forints while the Swiss franc at 401.54 forints from 400.11 forints.&

Since the beginning of the year, the forint has weakened by 9.1 percent against the euro, 18.9 percent against the dollar and 12.9 percent against the Swiss franc – reported by the Hungarian news portal Napi.hu.

In the last few months, the previously predicted worst-case scenario has become reality regarding the Hungarian currency. Still, the current situation is only the beginning of the slippery slope. We have just entered an economic recession, partly due to the war. Therefore, global inflation, interest rate hikes and the economic crisis are still ahead of us, and the forint is a very vulnerable currency compared to others, which does not bode well for the upcoming period either.

According to financial analysts, we can pay 450 forints for a euro as early as December this year.

In a year, the Hungarian currency has weakened by nearly 50 forints against the euro. If we look at the neighbouring Poland’s currency, we can only talk about a 12-forint depreciation. According to Zoltán Török, a financial analyst, the underperformance of the Hungarian Forint against other currencies is due to government debt. The Hungarian government’s debt is around 80 percent of the national GDP, while in the neighbouring countries it is much lower. In the Czech Republic, for example, it is at around 40-50 percent. Another reason is the energy crisis, which could particularly affect Hungary because of its close dependence on Russian energy.

As the Hungarian new portal rtl reports, the weakening of the forint has also made foreign travel and holidays much more difficult. People cannot calculate in advance when it is worth exchanging currency due to the 5 to 10 forint shift against the euro. The weakening of the forint is also bad for interest rate hikes and repayments. According to the expert, debtors who have taken out fixed-rate loans are safe. Although the interest rate freeze may also benefit many other stakeholders at the moment, if this will be terminated by the government, a drastic rise in repayments can be expected.

According to the financial expert, the best scenario for Hungary would be if the government could reach a deal with the European Commission. In this case, the rule of law supply could be removed, EU resources could be freed up and the forint could recover and not depreciate so drastically.

Hungarian forint currency change
Read alsoReason why the Hungarian forint keeps weakening

Hungarian forint has been hammered again: HUF has hit a new historic low! – UPDATE

The Hungarian forint started Tuesday with a sharp weakening against the leading currencies. 

On Tuesday morning, the euro was up slightly to 405.37 forints at half-past 9, reaching a new all-time high, according to Portfolio. Shortly before, it was at 404.87 forints, while in the morning it started from around 402 forints.

The dollar also hit a new historic low of 388.2 forints to dollar, also around half-past 9.

Underperforming the forint

The Czech koruna is flat today, the Polish zloty is down 0.25% and the forint has weakened 0.6% against the euro. In other words, the trend of the past weeks continues: the forint is persistently underperforming regional currencies.

As we wrote earlier, the Hungarian Central Bank’s interest rate hike last week, the simplification of the monetary policy toolkit, and the tight tone (further rate hikes) only temporarily strengthened the forint, we are back above the 400 level and the domestic currency has reached new lows.

Investors continue to be concerned about uncertainties surrounding Hungarian economic policy (EU dispute over EU funds, special taxes imposed, decree governance), which is also putting pressure on the forint exchange rate.

We also discussed the reason why the Hungarian forint keeps weakening, details HERE.

forint exchange rate - daily news hungary
Read alsoNBH director: Inflation to peak in autumn

UPDATE

Forint weakens to new low

CHF

The Hungarian forint weakened to 406.19 from 400.68 to the Swiss franc.

EUR

The forint fell to a new low against the euro, trading at 404.87 around 10:00 in the morning on Tuesday’s forex market, weakening from 401.84 late on Monday.

USD

The forint softened to 390.31, a new low against the dollar, slipping from 385.31.

Official forint fixing of the National Bank of Hungary

 

Budapest forint fixing – 2022. July 05. 11:39
Australian dollar           266.78
Brazilian real               73.69
Bulgarian lev               206.96
Canadian dollar             303.88
Chinese yuan                 58.58
Croatian kuna                53.77
Czech crown                  16.36
Danish krone                 54.41
Euro                        404.79
Hong Kong dollar             50.05
Iceland krona                 2.90
Indian Rupee                  4.96
Indonesian Rupiah (100)       2.62
Israeli shekel              111.24
Japanese yen (100)          289.09
Malaysian Ringgit            88.86
Mexican peso                 19.26
New Romanian lei             81.87
New Zealand dollar          241.88
Norwegian kroner             39.26
Philippine Peso               7.08
Polish zloty                 85.46
Pound sterling              473.04
Russian ruble                 6.83
Serb dinar                    3.45
Singapore dollar            279.86
South African rand           23.89
South-Korean won (100)       29.95
Swedish krona                37.48
Swiss franc                 407.23
Thai baht                    10.96
Turkish lira                 23.14
Ukrainian hryvna             13.29
USA dollar                  392.73

UPDATE

Read alsoForint at new lows against the euro, dollar and Swiss franc! – UPDATE

Hungarian forint: one of the world’s weakest currency

forint euro bills

With all the ups and (mostly) downs recently, the Hungarian forint has become one of the weakest currencies not only in the region – in Central and Eastern Europe – but in the whole world.

Second weakest currency in the world

In a year, only the Turkish lira and the Argentine peso have fallen more. On top of that, in the last three months, apart from the Chilean currency, the forint has been the weakest in the whole world, Portfolio.hu reports.

Since the beginning of the year, the forint has weakened by almost 7.5 percent against the euro. This cannot be explained merely with the difficult global economic environment, a war in our neighbourhood and high inflation. These are problems that affect our regional competitors in the same way, Portfolio.hu writes.

At the beginning of March, the record low level of the forint could be blamed on the war, but since then something else has been the problem. In three months, the forint has weakened by 8.4 percent against the euro, while the Polish zloty has depreciated only by 1.1 percent and the Czech koruna by 1.2 percent.

Events that affect the Hungarian currency

Until early May, the forint moved broadly in line with the Polish zloty, and that was when the split began. If we take a look at the events of the last two months, we might find the reasons why the Hungarian currency has been plunging. Portfolio.hu has gathered these events:

– In April, the European Commission launched a rule of law procedure against Hungary, and no agreement has been reached on the disbursement of EU funds.

– The market was not fully satisfied with the government’s fiscal adjustment package, which is partly based on special taxes that send a negative message to the business environment.

– The deteriorating fundamentals of the Hungarian economy are becoming increasingly apparent, especially the external imbalance, with the balance of payments and external trade balances both turning strongly negative.

– The dollar has strengthened: the US currency has gained 7% against the euro in three months. And the forint follows the dollar’s movements in the opposite direction, meaning that when the US currency strengthens, the forint usually weakens.

The bad news is that these negative effects are not yet abating, and there is no sign of them improving.

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Rent increases accelerate in Hungary

kitchen home flat

Rents in Hungary have increased extremely rapidly in recent times. We have already read about the rate at which real estate prices have risen, and now it is time for rents to start rising rapidly.

Rapid increase in rent prices

Rents rose at an accelerating pace in May: 2.6 percent nationally and 2.5 percent in Budapest compared to the previous month, Portfolio.hu reports. In the capital, prices on offer were on average 21 percent higher than in the same period last year, with the highest increase (24 percent) in the inner districts of Pest. In May, rentals were 9.7 percent higher than the pre-pandemic peak in January 2020 nationwide and 5.8 percent higher in Budapest, according to the latest KSH-ingatlan.com rent index.

After a downturn in the year of the Covid-19 outbreak, rents have risen steadily since February 2021. Rents in May were 60 percent above the 2015 base period level nationally and 51 percent above in the capital – and 9.7 and 5.8 percent above the pre-pandemic peak in January 2020.

Rents in Buda Hills and Pest inner districts are higher

Compared to the previous month, prices rose in all districts of the capital: most significantly – by around 3 percent – in the Buda Hills and the inner districts of Pest, while in the outer disctricts of Pest and other districts of Buda, the increase was slightly less pronounced: 1-2 percent, reports Portfolio.hu.

Over a year, rents rose by the most – 24 percent – in the inner districts of Pest and by the least – 13 percent –  in the outer districts of Pest; by 19 percent in both the mountainous and other districts of Buda and by 21 percent in the transitional districts of Pest.

Average rent prices

According to the summary of ingatlan.com, the average rent in Budapest was HUF 190 000 (EUR 482.34). The most expensive district is the II. district with an average rent of HUF 330 000 (EUR 837.71), while the V. district came second with HUF 312 000 (EUR 791.94), although the average monthly rent per square metre is higher.

According to the summary of ingatlan.com, the average rent in Budapest was HUF 190 000 (EUR 482.34). The most expensive district is the II. district with an average rent of HUF 330 000 (EUR 837.71), while the V. district came second with HUF 312 000 (EUR 791.94), although the average monthly rent per square metre is higher. In the two districts with the largest supply – XI. and XIII. –, average rents were HUF 196 000 (EUR 497.52) and HUF 174 000 (EUR 441.68) respectively.

Rents in the county capitals

According to azenpenzem.hu, in the county capitals, prices range between HUF 92 500 (EUR 234.76) and HUF 150 000 (EUR 380.7). The most expensive cities are Veszprém, Debrecen and Székesfehérvár. Kaposvár, Salgótarján and Szekszárd remain among the cheapest, with average rents below HUF 100 000 (EUR 253.8).

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Reason why the Hungarian forint keeps weakening

Hungarian forint currency change

The Hungarian forint has been getting weaker lately. Even when it strengthens, it is still not as strong as it could and should be. Read our article to find out why the Hungarian currency is where it is today.

Forint being this weak is unreasonable

“There is no reason for the euro to be 400 forints,” says former central bank governor György Surányi, who says that the forint is weakening at almost every word of György Matolcsy (Governor of the Hungarian National Bank, MNB) and Márton Nagy (Economic Minister). According to Surányi, this shows that in the eyes of the market neither the government nor the central bank has any credibility, writes Forbes.hu.

Former central bank president György Surányi shared his thoughts on the weakening of the forint in an interview with Privátbankár.hu on 23 June. Surányi was twice head of the Magyar Nemzeti Bank: in 1990-91, he was State Secretary, and between 1995 and 2001, he was its President.

The weakest in the region

It is a sad fact that the forint-euro exchange rate has been hovering around the 400 level for days. The forint has not performed well over the past ten years, with a decline of around 50%, it is one of the worst performers in the region. Since February alone, it has weakened by 12-13%, far underperforming the currencies of the region, Forbes.hu reports.

Why does the forint keep weakening?

According to the Central Statistical Office (KSH), domestic inflation is 10.7%. About half of inflation is the result of externalities, according to Surányi. But the other half is due to internal effects.

“The head of the MNB has said that neither credit outflows nor loose fiscal policy nor real wage increases have an inflationary impact. So what on earth could have an inflationary effect?” asks Surányi.

“Whenever either the minister or the central bank president has spoken, the forint has always reacted by falling. They should think about their own credibility,”

he adds.

As for the Minister of Economic Development, Márton Nagy, who said that the forint exchange rate is exactly where it should be, he said, “I do not think it is a lucky way of putting it, the exchange rate fell five forints after that. In a small, open economy, neither the government nor the central bank can say that they do not care about the exchange rate.”

forint exchange rate - daily news hungary
Read alsoNo stopping, here is the new low: 404 forints for the euro

No stopping, here is the new low: 404 forints for the euro

forint exchange rate - daily news hungary

The forint weakened further on Monday morning. The euro-for-euro exchange rate is now above 404 forints, and technically there is nothing that can stop the fall, only a drastic move by the Hungarian National Bank can turn the tide, napi.hu said.

The forint continued to depreciate on Monday. The Hungarian currency was at 401.5 against the euro at the open, but the common EU currency was already above 404 forints before 11 a.m., with the exchange rate currently at a historic high of 404.779. The dollar rose to 382 against the euro, while the Swiss franc was also trading above 399 forints this morning.

Experts do not expect any significant forint appreciation in the near future. “The euro is not really able to break away from the 400 forint level, so the exchange rate has been near its peak again on Friday. The exchange rate is still very far from the 50-day moving average, and for the time being it continues its upward move in the established upward trend channel, of course the 400 level seems to be strong, but the euro/forint cannot break away from it in the long term. This week, the MNB’s interest rate decision, possibly a change in the benchmark rate for Thursday’s one-week deposit tender, could bring strength for the Hungarian currency,” analysts at KBC Equitis wrote this morning.

“The dollar weakened slightly against the euro on the back of positive sentiment and lower interest rate hike expectations, while the yen also weakened on improved risk appetite. The forint was unable to benefit from the weakening dollar and the good sentiment, and moved above the key 400 level against the euro. Thus, the domestic currency continues to be viewed negatively as the zloty and the Czech koruna strengthened,” added Gergely Suppán, senior analyst at Magyar Bankholding.

forint euro bills
Read alsoCould anything save the Hungarian forint?

Nothing to stop the fall

“We start the week with the euro above 400 forints ahead of the MNB interest rate decision. With the rate still above the key 400 forint euro level, it is feared that the central bank will fail to reassure markets on Tuesday, which could push the rate to historic levels. This is also important as there is no technical resistance at these levels, as we are near all-time highs, and in an extreme case, the fall could even accelerate due to a negative message from market participants. In addition, we have the lowest base rate in the region, after the Czech and Polish central banks have both made significant hikes in recent weeks, which is of course partly offset by the fact that the benchmark one-week tender is still higher here. A hike lower than the expected 50 basis points could push the forint into a negative spiral, despite the central bank’s earlier communication that it would proceed at a slower pace, this may be worth revisiting,” Equilor Befektetési Zrt said.

The majority of the Hungarian population is not surprised by this news, as they expect the Hungarian currency to weaken further this year, and even expect the euro to reach 450 forints by the end of the year.

Hungarian forint currency change
Read alsoReason why the Hungarian forint keeps weakening

Hungarian forint strengthens against the euro

forint euro bills

Every day, the forint is getting stronger against the euro, moving further away from the lows.

At the beginning of the week, one euro cost 400.2 forints.

However, by 7 AM on Wednesday morning, the EU currency cost 394.26.

The dollar, on the other hand, has strengthened, from 374.1 forints last night to 375.74 on Wednesday morning. The forint has also weakened against the Swiss franc, going from 387.05 a franc last night to 388.03 this morning, according to naphire.hu.

The exchange rate is holding steady for the time being, without any major swings. Last week, the euro crossed the psychological barrier of 400. The Hungarian government has argued that the weakening against the euro has external causes, index.hu reports.

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Hungarian petrol stations in huge trouble over fuel price cap extension!

fuel Hungary foreigners price cap

Dual pricing at petrol stations is not sustainable. This is the biggest problem for small petrol stations, which are still not adequately compensated by the government for the cost of the price freeze, the president of the Independent Petrol Stations Association told Inforadio.

Small petrol stations suffer

Every day, they (small petrol stations – ed.) are struggling with the elements, one of which is double pricing, said Gábor Egri. Among the problems arising from dual pricing, he said that there should be a credible examination at petrol stations of who is entitled to the official price and who is subject to the market price, but it is impossible to do this.

All the more so, because in an authentic inspection, they would have to check the licence plates and the registration documents, but in the latter case they have not been given any information about what kind of document samples exist, said the president of the Independent Petrol Stations Association, as portfolio.hu reported. He said that

“looking at number plates and seeing a registration document being floated in front of someone is not credible”.

Abuses

Gábor Egri also pointed out that official and market prices are very different (the market price of diesel is around HUF 820 (EUR 2.05), while the official price is HUF 480 (EUR 1.20)) and that many abuses can result from customers buying petrol at official prices and then reselling it at market prices.

Egri also thinks it is a real danger that illegal fuel smuggling could boom in neighbouring countries.

What could be the solution?

Egri would see the solution in the fact that small petrol stations would become strategic partners in the country’s supply, since in addition to Mol, these are the petrol station networks or individual petrol stations that have a business and retail fuel sales only in Hungary.

He stressed that while small petrol stations can focus only on the Hungarian market, international companies think in bigger terms and may close their Hungarian operations if they are loss-making, as infostart.hu reports.

Subsidy should be increased

The Independent Petrol Stations Association also proposed that the subsidy scheme for small stations should be increased from the current HUF 20 (EUR 0.050) to at least HUF 40 (EUR 0.1), which would still cover the cost of transport, so the amount that petrol stations would have left over would be HUF 10-12 (EUR 0.025-0.030), or at most HUF 16 (EUR 0.040) per litre, which would be “not enough to cover the electricity bill”.

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Could anything save the Hungarian forint?

forint euro bills

On Monday 13 June, the forint broke all records: the euro rose above 400 forints, even reached 402. Is there still hope that the exchange rate will ever normalise? What could help the Hungarian currency? Read our article to find out.

According to privatbankar.hu, it was known that the euro would reach the 400 level sooner or later. At the end of February, the euro was at 370 forints. Many believe that if nothing happens to save the forint, we could reach 450 in less than 4 months.

The weakest link

More than three months ago, the Hungarian currency was brought down by the fact that the Russian-Ukrainian war made the forint the weakest link for investors in the Central and Eastern European region, and they started speculating against it, writes privatbankar.hu.

For a brief period in April, the euro was worth 366 forints, leading many to false hopes. People thought that they no longer had to worry about the forint, that everything was fine.

Then, at the end of April, the European Commission launched the rule of law procedure against Hungary. This was a sure sign of the forint’s deterioration because it threatened to deprive the Hungarian economy of EU funds.

What can be done for the forint?

It is the government that can do the most to prevent the forint from weakening further. First and foremost, by taking steps to stop the EU’s rule of law procedure, which would allow money from the recovery fund to start coming to Hungary.

Of course, the abolition of price freezes and the reduction of the overhead cuts, and the withdrawal of special taxes or their reduction may also convince the outside world and thus investors that it is worth keeping their money in our country – these exchanges may strengthen the forint. But the biggest impact would come from an agreement with the EU.

Prospects are not too good

However, penzbankar.hu now sees little chance of government members even lifting a finger to make things better. At least this is the conclusion to be drawn from the repeatedly uttered statement by Márton Nagy, the Minister of Economic Development, that there is nothing wrong with the forint exchange rate, it is exactly where it should be.

forint euro bills
Read alsoCould anything save the Hungarian forint?

Hungarian forint at an all-time low against the euro and the dollar

forint exchange rate - daily news hungary

The forint reached an all-time low against the euro and the dollar on Monday.

The euro was at a record high of 401.43 forints and the dollar at 384.54 forints early Monday afternoon. Compared to last week’s start, the forint is 2.4 percent weaker against the euro and 5.2 percent weaker against the dollar.

For the Swiss franc, the weakest exchange rate for the forint is the CHF 398.93 franc mark on 7 March 2022.

At 386.54 forints early Monday afternoon, the Swiss franc was 1.8 percent weaker than last week’s start.

The forint is 1.1 percent weaker against the euro, 5.2 percent weaker against the dollar and 0.2 percent weaker against the Swiss franc at early afternoon Monday compared with its June start.

Since the start of the year, the forint has weakened 8.8 percent against the euro, 18.6 percent against the dollar, and 8.7 percent against the Swiss franc.

As we wrote yesterday, nearly 70% of the Hungarian population support the introduction of euro in Hungary, survey and details HERE.

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MEP Gyöngyösi: Growing contrast between Croatia and Hungary

Jobbik MEP Márton Gyöngyösi’s thoughts via press release: 

The context for this post is given by the news that Croatia is going to adopt the EURO as of 1 January 2023 and, if everything goes according to the plans, the country will join the Schengen zone as well. It is in stark contrast with my homeland, Hungary, which is taking long strides on the way out of the European Union.

Despite sharing most of their history in Central Europe, Croatia and Hungary don’t show such a huge difference for the first time: when the region’s Socialist regimes collapsed one after the other around 1990, Hungary was still considered as the honour student of the area, while Croatia was entangled in a home defence war to establish and/or protect its mere existence as a state. 

Back then, who would have thought that the “ranking” of the two countries will be reversed?

After the difficulties of the 1990s, Croatia could only join the EU in 2013, with a significant backlog compared to the rest of the region. However, the country has been able to demonstrate its ability to utilize the opportunities lying in European integration. Taking no more than ten years after its accession, Croatia will be able to join the EU’s “innermost circles”, i.e., Schengen and the Eurozone. I think the latter appears to be an even larger achievement as EU member states are required to meet famously strict economic conditions to adopt the common currency. After lapping several countries that had joined earlier, Croatia was able to meet all those requirements.

It’s natural to compare the country’s performance to that of Hungary which was Central Europe’s proud leader in terms of living standards back in the 1990s, but is now considered as one of the stragglers.

Although Hungary became an EU member as early as in 2004, the accession to the Eurozone is nowhere in sight. In fact, the Fidesz government stipulated in the Constitution that the Forint will remain Hungary’s currency. We are talking about the same Forint that has been sinking to historical lows over the past 6 months compared to the Euro. Our currency is being devalued at an astonishing rate while the government regulates food and fuel prices in a feeble attempt to hide the problem from the citizens. If you look at the economy, you see an increasingly gloomy picture with devalued money and an impending commodity shortage resulting from the regulated prices. As far as the political environment is concerned, the Hungarian government, having realized its complete isolation in Europe, is now making ever larger gestures to Moscow, to the point where PM Viktor Orbán used his usual Friday radio interview to joke about how little chance Ukraine has in the war.

This doesn’t mean that the people of Hungary are against the European Union or the adoption of the Euro, in fact.

Under the current circumstances however, when Orbán’s regime uses the Hungarian authorities to block opposition parties so he doesn’t even need to commit electoral fraud to win the elections due to the government’s huge dominance in resources and media, pro-Europe opinions are hardly heard in the public discourse. I hope that the European Union’s institutions soon realize the importance of holding member state governments accountable for European values and the democratic rule of law, since not all countries seem to function as well as Croatia.

Until they come to that realization however, we can do nothing but envy our south western neighbours…

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Sigificant proportion of Hungarians would introduce euro in Hungary

forint euro bills

According to a recent survey, nearly 70% of the Hungarian population support the introduction of euro in Hungary.

According to a recent survey carried out by Eurobarometer, more than two thirds of those countries’ population that do not yet have the EU currency are in favour of introducing the euro. The survey was carried out at the end of April. Within the framework of which, a total of 7074 telephone interviews were conducted. Based on the results,

Romania (77%) and Hungary (69%) have the highest proportion of people in favour of the changeover to the euro.

Meanwhile, the proportion of Hungarian respondents opposing a unified European currency increased from 26% to 28% between 2021 and 2022.

It is worth noting that the exchange rate of the forint against the euro during the period of the survey was between 370 and 380. Since then there has been a more significant depreciation of the forint – reported by Portfolio.

As the Hungarian news portal Blikk reports, the lowest proportion of people supporting the introduction of a unified European currency are in Sweden (45%), Bulgaria (44%) and the Czech Republic (44%).

As far as preparedness is concerned, Croatians (37%) are the most prepared for the introduction of Euro that will come into effect in January. Meanwhile, citizens in Bulgaria and Hungary (23%) are the least prepared.

60% of respondents think that the introduction of the euro would have a positive impact on Hungary.

The proportion of those who think it would have a negative impact has also increased by 2% since last year (35%).

Nevertheless, the introduction of the euro is not yet expected in Hungary. Although György Matolcsy, governor of the Hungarian National Bank, said last year that Hungary wants to introduce the euro, the Orbán government, due to economic autonomy, does not plan to introduce it in the near future – reported by hvg.

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Read alsoSigificant proportion of Hungarians would introduce euro in Hungary

Another historical low for the Hungarian forint

Hungarian forint

The forint weakened to an all-time low against the dollar on Friday.

Shortly before 1:00 PM on Friday, the forint weakened to a historical low against the dollar. Meanwhile, the euro was also close to a record high. The Hungarian currency also lost a lot against the currencies of the region.

The forint just crossed the 376.829 level against the dollar, which can well be considered a historical record, according to Napi.hu. In practice, this means that the forint has never been worth so little. Even against the euro, it is only a stone’s throw away from the 400 forint psychological limit.

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