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EURHUF Continues Trading With a Downward Bias; Outperforming Regional Peers

HUNGARY
EUR/HUF (-0.50%) has resumed trading with a downward bias today despite no notable improvement in market risk sentiment - which has been the key driver in the past weeks - as evidenced by both EUR/USD and e-mini S&P contracts trading close to flat on the day. The cross trades below the 376.00 level at the time of typing; key support remains at 372.38, the Mar 1 low.
  • “We just mutually expressed interest that by the summer we can reach a good solution,” Minister Tibor Navracsics told reporters on Wednesday after meetings in Brussels with members of the European Commission regarding frozen EU funds.
  • Despite the general downtrend in EUR/HUF year-to-date, concerns of a deepening recession – seen in the 4.6% y/y plunge in industrial production and expected 5.9% y/y fall in retail sales tomorrow - and uncertainty over accessing frozen EU funds show there remains two-way risk for the HUF going forward.

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