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HUF Trades on Firmer Footing Ahead of NBH Tomorrow Afternoon

HUNGARY
EUR/HUF (-0.40%) has dented some of last week’s gains ahead of the NBH rate decision tomorrow despite the mixed performance in EUR and equities. HUF strength comes amid the relatively strong performance of other currencies in the EM space, with the likes of ZAR, PLN and CZK in the green against the EUR.
  • EUR/HUF has traded through the 50-day EMA which intersects today at 376.54, exposing 380.29, the Apr 20 high and a key resistance. A clear break of this level would suggest scope for a stronger recovery. Nevertheless, the primary technical trend direction remains down and a breach of 368.05, the May 16 low, would confirm a resumption of the trend and re-open 366.41, the Mar 30 2022 low.
  • Market consensus looks for the first cut to the 18% effective rate at tomorrow’s rate setting meeting, with calls for a cut ranging from 75-300bps (See our full preview here: https://roar-assets-auto.rbl.ms/files/53036/MNINBH...)

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