Forint should continue to trade well – Standard Chartered

The National Bank of Hungary (NBH) lowered the base rate by 75 bps to 12.25% from 13.00% on Tuesday, October 24. Nonetheless, economists at Standard Chartered expect the Forint (HUF) to remain solid.

Carry particularly attractive for HUF

We think the HUF should continue to trade well, despite recent rate cuts. 

For Hungary, the Czech Republic and Poland (CE3), carry is particularly attractive. 

The one negative for the HUF, compared to the rest of CE3, is a lack of FX reserves. Because of this, it is more at risk of a sell-off if global conditions worsen.