The forint gained the most in almost four weeks after a government official said Hungary is making progress toward starting bailout talks with the International Monetary Fund and the European Union.
The forint appreciated 1 percent to 291.02 per euro by 5 p.m. in Budapest, the biggest one-day rally since Feb. 13 and paring its decline this week to 0.5 percent.
The date for the start of talks “hinges on a decision by a top policy maker,” Roland Natran, a deputy state secretary at the Economy Ministry, told Gazdasagi Radio yesterday in an interview, according to a summary and audio file posted on the station’s website today. “This could be tomorrow or it could be later but on the basic questions the positions have moved very close to one another.”
Hungary, the European Union’s most indebted eastern member, has failed to restart talks on financial assistance since last year because of disputes with the international aid providers over legislation. The forint strengthened for the first time in a week yesterday after Tamas Fellegi, the minister in charge of aid negotiations said Hungary’s “only goal” is to reach a financing agreement “fast” with no “Plan B.”
“Although the start of formal talks will be delayed, the agreement with the IMF will take place in the second quarter, helping Hungarian assets to appreciate in the second half,” Orsolya Nyeste and Zoltan Arokszallasi, Budapest-based economists at Erste Group Bank AG, wrote in a research report today.
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