Despite a weaker forint another NBH’s cut still expected
The negative market sentiment (The missile attack on a Malaysian airliner above the Ukrainian/Russian border and the Israeli ground-move against Hamas) pushed the EUR/HUF above 311. Nevertheless despite of the weakening we expect that NBH may cut base rate by 10bp from 2.3% to 2.2% on Tuesday, which is already priced in the market. In short term the HUF may weaken slightly if international sentiment remains negative, but we don’t expect massive volatility. We see important resistance at 312.5 and 315 on the weak side, which might be tested in nervous market environment, but we expect mainly range trading between 303 and 313.
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