July 19, 2024 09:16 GMT
HUF: Forint Unfazed by Risk-Off Theme, Focus Turns to NBH Decision Next Week
HUF
A "bad patch" from Crowdstrike prompted major outages across global services, placing equities and US yields under pressure. However, the risk-off tone has had negligible impact on the forint, with EURHUF just a moderate 0.1% higher on the session.
- While we remain above yesterday’s lows around 389.50, a resumption of losses would continue to undermine the bullish theme for EURHUF with sights on 388.88, the 61.8% retracement of the May 28 - Jun 14 bull leg. The 76.4% retracement level of the same bull leg is at 386.53.
- The NBH is expected to act in-line with its hawkish messaging and keep rates unchanged at 7.00% on July 23. Despite headline inflation coming in below expectations in June, Deputy Governor Virag said the central bank will not overreact to a single positive data-point. Among sell-side, most analysts are expecting rates to be held steady at this juncture, though risks of a 25bp cut acknowledged are by most.
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