Bloomberg News

Forint Gains Most in Month as EU’s Highest Rate Kept on Hold

May 29, 2012

The forint gained the most in a month and Hungarian bonds weakened as the country’s central bank held the European Union’s highest benchmark rate unchanged following a delay in obtaining International Monetary Fund aid.

Hungary’s currency appreciated 0.9 percent to 296.6 per euro by 4:57 p.m. in Budapest, the biggest advance on a closing basis since April 25. The yield on the government’s benchmark three-year bonds rose five basis points, or 0.05 percentage point, to 8.345 percent.

The Magyar Nemzeti Bank left the two-week deposit rate at 7 percent for a fifth month today, meeting the projection of all 23 economists surveyed by Bloomberg News. Hungary has failed to start talks on IMF aid for six months because of a dispute on legislation affecting the central bank’s independence.

It’s “difficult to see rate moves in the near term until we get real progress on the IMF front,” Timothy Ash, a London- based strategist at Royal Bank of Scotland Group Plc, wrote by e-mail after the rate decision.

To contact the reporter on this story: Andras Gergely in Budapest at agergely@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net


The Good Business Issue
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus