Bad news for the forint – Commerzbank

FXStreet Insights Team FXStreet

There are currently not so many arguments in favor of the forint. Growth was disappointing in the second quarter, while at the same time the cutting cycle paused at 6.75% after inflation surprisingly rose to over 4% again in July. Core inflation has also risen back to 4.7% and is the worst performer among the CE3, Commerzbank’s FX analyst Antje Praefcke notes.

Forint is likely to remain under pressure

“Inflation is likely to have fallen again slightly in August, as the data due to be published today should show. But the job remains challenging for the central bank (MNB). According to reports, there is a risk for an expansionary fiscal policy since President Victor Orban could apparently change his plans for budget consolidation in order to put together large spending packages in the run-up to the 2026 elections.”

“According to the Ministry of Finance, the budget deficit, which had risen to 7.6% of GDP during the pandemic, was planned to fall to 2.9% in 2026. The new draft budget will be presented in November and could render these plans moot.”

“The market does not like such prospects at all. After all, Hungary's rating, which is already low, could be at risk if the promised budget consolidation falls by the wayside in view of the 2026 elections. Therefore, the cand EUR/HUF could head back towards 400 if the data and news remain gloomy.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold holds above $5,000 as bears seem hesitant amid Fed rate cut bets

Gold edges lower at the start of a new week, though it defends the $5,000 psychological mark through the Asian session. The underlying bullish sentiment is seen acting as a headwind for the bullion. However, bets for more rate cuts by the Fed, bolstered by Friday's softer US CPI, keep the US Dollar bulls on the defensive and continue to support the non-yielding yellow metal as the focus now shifts to FOMC Minutes on Wednesday.

Week ahead: Data blitz, Fed Minutes and RBNZ decision in the spotlight

The US jobs report for January, which was delayed slightly, didn’t do the dovish Fed bets any favours, as expectations of a soft print did not materialize, confounding the raft of weak job indicators seen in the prior week.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.