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The forint gained, capping the strongest quarter in 2 1/2 years as Hungary sought a bailout from the International Monetary Fund and European governments increased funds used to fight the region’s debt crisis.
Hungary’s currency appreciated 0.3 percent to 295.24 per euro by 4:23 p.m. in Budapest. That means a 6.7 percent advance in the past three months, the most since the second quarter of 2009 and the second-best performance for the period worldwide after the Polish zloty. The rally in the government’s 10-year bonds cut yields 13 basis points, or 0.13 percentage point, to 9.08 percent, compared with as high as 10.8 percent on Jan 4.
European ministers today approved fresh rescue lending to expand funds already committed to an anti-crisis firewall to contain the crisis in Greece, Ireland and Portugal. Hungary, the most indebted eastern member of the European Union, has sought aid from the IMF and the EU for the second time since 2008.
“We are still of the view that all parties want to sign the agreement eventually, and thus expect notably lower yields in the summer to come,” Adam Keszeg, a Budapest-based analyst at Raiffeisen Bank International AG (RBI), wrote in a research report today on Hungary’s IMF talks.
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