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HUF: PLN/HUF Hits Fresh Record High Amid Divergent CE3 Performance

HUF
CEEMEAEM BulletBulletGlobalEmerging Market NewsHungaryRegion

The forint resumed yesterday’s weakening trend at the start of Friday trade, with performance of the local currency continuing to diverge from that of the Polish zloty and Czech koruna. Underperformance of the forint pushed PLNHUF as much as 0.38% higher, with the cross hitting a fresh record high.

  • The rally in EURHUF this month has prompted a spike in 1m vols to ~2 month highs, while the option vol skew is showing more in favour of calls. However, these unfavourable HUF dynamics have led to an uptick across HUF FRAs, with fading bets of a large Fed cut and rising Middle East tensions also contributing to markets pricing in a less-aggressive NBH easing cycle to year-end.
  • At typing, EURHUF is trading slightly lower but the cross had made a brief test of yesterday’s highs earlier in the session. Resistance to watch is marked at 402.45, the March 2020 high, a level that was closely matched on Monday. A break here would set sights on 404.35, the January 2020 high.
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The forint resumed yesterday’s weakening trend at the start of Friday trade, with performance of the local currency continuing to diverge from that of the Polish zloty and Czech koruna. Underperformance of the forint pushed PLNHUF as much as 0.38% higher, with the cross hitting a fresh record high.

  • The rally in EURHUF this month has prompted a spike in 1m vols to ~2 month highs, while the option vol skew is showing more in favour of calls. However, these unfavourable HUF dynamics have led to an uptick across HUF FRAs, with fading bets of a large Fed cut and rising Middle East tensions also contributing to markets pricing in a less-aggressive NBH easing cycle to year-end.
  • At typing, EURHUF is trading slightly lower but the cross had made a brief test of yesterday’s highs earlier in the session. Resistance to watch is marked at 402.45, the March 2020 high, a level that was closely matched on Monday. A break here would set sights on 404.35, the January 2020 high.