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HUF: Forint Unable to Benefit from Surge in China Equities

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CE3 currencies have pared yesterday's gains, underperforming most of their EM peers during Wednesday trade. Broader strength in the EM FX space has been helped by the surge in China equities overnight, with the CSI 300 up 1.5%, prompting solid gains for the likes of IDR, MYR and ZAR. Regional focus today is on the CNB rate decision at 13:30BST/14:30CET.

  • Today’s gains in EURHUF (+0.15%) put the cross just above yesterday’s post-NBH highs. Deputy Governor Virag’s guidance in the post-decision press conference has been interpreted as dovish, given he signaled that rate cuts would be discussed at each of the remaining meetings this year.
  • Pre-decision speculation was that the central bank would deliver two more 25bp cuts in 2024 (in November and December), so while the new guidance does not necessarily alter the outlook, it will add to uncertainty in the coming months. Our full review for Tuesday’s decision will be released later today.
  • For EURHUF, a stronger reversal higher would refocus attention on key resistance at 399.21, the Aug 5 high. On the downside, support is marked at 394.09, the 50-day EMA.
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CE3 currencies have pared yesterday's gains, underperforming most of their EM peers during Wednesday trade. Broader strength in the EM FX space has been helped by the surge in China equities overnight, with the CSI 300 up 1.5%, prompting solid gains for the likes of IDR, MYR and ZAR. Regional focus today is on the CNB rate decision at 13:30BST/14:30CET.

  • Today’s gains in EURHUF (+0.15%) put the cross just above yesterday’s post-NBH highs. Deputy Governor Virag’s guidance in the post-decision press conference has been interpreted as dovish, given he signaled that rate cuts would be discussed at each of the remaining meetings this year.
  • Pre-decision speculation was that the central bank would deliver two more 25bp cuts in 2024 (in November and December), so while the new guidance does not necessarily alter the outlook, it will add to uncertainty in the coming months. Our full review for Tuesday’s decision will be released later today.
  • For EURHUF, a stronger reversal higher would refocus attention on key resistance at 399.21, the Aug 5 high. On the downside, support is marked at 394.09, the 50-day EMA.