Bloomberg News

Forint Gains Most in a Month on Resistance at 300 Per Euro Level

March 08, 2013

The forint strengthened the most in a month, rebounding after crossing a key level of 300 per euro.

Hungary’s currency appreciated 0.6 percent to 296.81 per euro by 12:46 p.m. in Budapest, paring a fourth week of declines. The forint breached the 300-mark for the first time in nine months on March 6, weakening to as low as 300.33 per euro yesterday, as traders speculated the government may use central bank currency reserves to provide relief to foreign-currency mortgage borrowers.

“The forint lost momentum after it didn’t stay above 300,” Akos Ruzsonyi a Budapest-based trader at Commerzbank AG, wrote by e-mail.

The forint lost 1.9 percent in the month to March 6, the worst performance among more than 20 emerging-market currencies tracked by Bloomberg. Prime Minister Viktor Orban said on the day Hungary must be “very careful” with its foreign reserves.

Emerging-market stocks rose, heading for the biggest weekly advance in more than two months, as economic data from China to Japan and the U.S. bolstered confidence in the global expansion.

“No further unsettling news came,” Ruzsonyi said. “The forint had badly underperformed recently, now it is correcting the most in the other direction,” Ruzsonyi said.

Yields on the government’s 10-year forint-denominated bonds fell four basis points, or 0.04 percentage point, to 6.396 percent.

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

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net


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