Hungarian central bank meeting turned out to be the non-event but managed to trigger a notable HUF rally. Economists at ING expect EUR/HUF to stabilise around 390.  

Forint strongest since the middle of last year

“The Hungarian central bank confirmed its commitment to keeping conditions tight for a longer period and that it has taken a patient approach to monetary policy. Overall, it has sent a very clear signal that the hawkish mode will last for an extended period of time and the central bank is not going to allow any hasty moves.”

“The Forint is the strongest since the middle of last year and we believe it could still benefit from yesterday's decision. Added to this is the higher EUR/USD level compared to last week and yesterday's renewed drop in gas prices back below €60/MWh.” 

“On the other hand, we may see some profit-taking today after the Forint's multi-day rally and ahead of Friday's risky sovereign rating review from S&P.” 

“Overall, we expect the forint to stabilise around 390 EUR/HUF for now.”