Hungarian Forint: Holds firm against Euro below 371 - Societe Generale

Societe Generale analysts observe that the EUR/HUF exchange rate remains confined between 371 and a crucial resistance level of 371, with trading within a base formation. To signal a significant upward trend, the rate must surpass this pivotal point. The previous failed attempt to surmount this hurdle occurred in March. A recent pivot low of 359 acts as a short-term support level, and a breach below this figure could indicate the resumption of a downtrend.

Hungary's headline Consumer Price Index (CPI) in August rose marginally to 1.3% year-over-year from 1.2% in July, leaving the Hungarian National Bank (MNB) with options for potential future easing. However, market focus has shifted away from immediate data following Bloomberg's report suggesting the MNB might pause and possibly reduce its inflation target as part of the longer-term strategy towards euro adoption.

The attention will now be centered on the central bank's upcoming press conference on Thursday, where Governor Varga and Finance Minister Andras Karman could offer further insights into the bank's stance.