HUF: Strong carry underpins EUR/HUF lows – ING

💡 DMK Insight

EUR/HUF just hit two-year lows, and here’s why that matters: The recent drop below 377 signals a shift in market sentiment, particularly as Central and Eastern European trading remains subdued. While EUR/PLN and EUR/CZK are holding steady, the weakness in the Hungarian forint could indicate underlying economic concerns or shifts in monetary policy that traders need to watch closely. This divergence suggests that while some currencies are stable, the forint’s decline could lead to increased volatility in related assets, especially if it prompts a reassessment of risk in the region. Traders should keep an eye on the 377 level for potential rebounds or further declines. If the forint continues to weaken, it could trigger a broader sell-off in Eastern European currencies, impacting pairs like EUR/PLN and EUR/CZK. Additionally, monitor any economic data releases from Hungary that could provide insight into the central bank’s next moves, as these could create trading opportunities in the short term.