Finance News
By Maheen Hernandez
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Why the Forecast Changed. Hungary's inflation problem keeps getting worse. Prices keep climbing, and that's forced…
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What Hungary's Doing About It. Hungary's government has rolled out various fiscal measures to try stabilizing things. Some worked.
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What Traders Are Watching Now. Market participants will keep their eyes on Hungary's economic releases going forward.
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Goldman Sachs just changed its call on the euro-forint pair. The bank now sees a stronger Hungarian forint ahead, driven by what's happening inside Hungary's economy right now.
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The shift comes as Hungary deals with inflation that won't quit and fiscal policies that have markets second-guessing everything.
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Hungary's inflation problem keeps getting worse. Prices keep climbing, and that's forced policymakers in Budapest to rethink their entire approach to managing the economy.
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The investment bank didn't give exact numbers for where EUR/HUF will land. But the direction is clear enough.
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Markets have been watching Hungary closely for months now. The fiscal situation there isn't great.
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Rising inflation in Hungary has been hard to ignore. It's not just a blip. The numbers have stayed elevated long enough that it's changed how analysts think about the currency's…
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The bank's clients will use this updated forecast to position their forex trades. For anyone holding euros or forints, this matters.
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No one from Goldman Sachs gave a quote about the specific mechanics. The bank just published its revised outlook and left it at that.
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Related: Goldman Sachs Tells Traders to Short Euro Against Forint as Hungary Eyes Eurozone Entry
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The Hungarian central bank has been in a tough spot. Inflation pressures demand one response, but fiscal constraints limit what's actually possible.
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Goldman's analysis seems to bet that Hungary's fiscal tightening and inflation dynamics will support the forint more than weaken it.
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Other investment banks haven't all followed Goldman's lead yet. Some still see risks that could push the forint weaker instead.
The Currency Analytics
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