The forint plummeted to an all-time low against the euro of 312 on Wednesday, while the dollar reached multi-year highs against the currency, hitting 249. The euro and the dollar all returned these gains, however, and moved lower after the close of the interbank market in Budapest.
Several factors contributed to the weakening of the forint, including Obama’s naming of Hungary as a potential risk country, a joint statement from regional central banks, the dual assessment of the CEE region and its financial systems from Romania and Bulgaria, as well as the latter two countries’ recent negative outlook given on Hungary’s rating.
Deutsche Bank’s forecasts on the country falling to a deeper recession, of over 5%, and news on the frosty reception of Prime Minister Ferenc Gyurcsány’s speech to investors in London did not help the forint either.
While the currencies and stock markets of all countries in the region straightened, Hungary stood out from the crowd with sharply falling share prices and a weakening currency. Analysts agree that the recent events indicate that Hungary is being cut off from the region, which is bad news for Hungary.
The question is whether this is just a technical event or the start of a trend. There is also consensus that the level at which the Central Bank may intervene to support the forint is around 310 to the euro.
Yeah, right.
Add the APEH Terror with Stupid tax regulations, exorbitant fines, burocratia and careless of people as the ellte just gets richer, et voilá…
We better buy a boat in Greece, at leas the Sun is free there…
And forget about investing and working my ass off in HU just for the health of mr. Gyurcsány.
Pass..!!
Obama never said that Hungary is a potential threat, Obama is helping Hungary, this is what he acctually said: “One of the things that Prime Minister Brown and I talked about is how can we coordinate so that all the G20 countries, all the major countries around the world, in a coordinated fashion, are stimulating their economies; how can we make sure that there are a common set of principles, in terms of how we’re approaching banking, so that problems that exist in emerging markets like Hungary or the Ukraine don’t have these enormous ripple effects that wash back onto our shores, and we’re providing them with some help in a coordinated international fashion, as well.” So stop blaming other countries. They only wanted to help, not to be critisized by you.
Dear Na: I think you might be a little bit confused. Or a lot, take your pick. Here is how it goes in reality. Barack Hussein Obama is the president of the United States of America, a.k.a. “POTUS.” As such an elected official, his job is to help the United States of America and its citizenry. If you think that the Americans have elected him to “help Hungary” instead or in addition to helping his own nation, you are gravely mistaken.
Next thing you are going to theorize, Prime Minister Frankie Gurcsany said that he is going to help America? Actually, I wouldn’t be surprised if he had said that. Thanks — but no thanks. Meanwhile, Prez Obama is here to help the Yanks, and the Europeans have gotta solve their mess on their own. Or else ask yet again the Russians for help. They are closer than the Amis, actually.
Fact about Hungary is that Tadjikistan and Uzbekhistan are rated as having healthier economies than basket case Hungary. I live in the States and work in Wash-DC, and the new “Specters of Death” tossed about in conversions besides Iceland is Hungary and Latvia. In other words, nobody is talking negative about Romania, BUlgaria, the Check Republic, etc. And Slovakia, Hungary’s arch-enemy, is uniformly mentioned as a shining example of how things can go right in a former East Block nation.
No, the Amercians will NOT help Europe, no way, Jose. The Europeans cooked up their own mess with the EU and with the Euro zone, then tried to get rich quick by buying into the US sub-prime mortgage mess. Now, it is tuime to pay the piper. Blaming everybody else out there but themselves will not work at this time. The Americans, Canadians, Austrlians, etc, etc have their own sets of problems, and they are not soliciting Europe to fix them. It is perhaps time for Europenas to stand up and stop being such crybabies.
Fantron. You are correct. Europe must solve its own problems. Hungary has one big problem from which all others spring: Miniszterelnök, Gyurcsany Ferenc.
Tell me, Fantron..how many of your presidents actually “saw out” their natural life???
Intervention by the central bank “propping up” the forint won’t help Hungary in the long term. Currency reserves will be “drawn” on, and this will give a false impression of the forints standing on the world markets. Huf has to find its own level over a period of time…Forint always has been a “manipulated” currency, anyway. Check back over the past twelve months if you don’t believe me.
Jojogunn
Exactly right re. the artificiality of the laughably soft-soft-soft HUF. I was walking on 42nd Street in Manhattan just last night. Happened onto a currency exchange booth sandwitched in-between a movie theater and a regular theater on the south side of the street. The HUF was listed as one of the currencies that they take in exchange for US$, but when I pressed the guy on the rate, he had told me that he could do the exchange at 385 forints per $. In other words, I give him 385 HUF — he gives my one Yankee buck. So, this would be the “New York street rate” for the HUF as of 5 March 2009, you see. Which is definitely a looooong way for the artificially propped-up 249 to 1 rate that the Hungarians are fooling themselves as being the “real” exchange rate.
Fantron. If you have an hour, or two, check on one of your own, namely George Soros- billionaire
and ex-con, banged up in France for insider-trading.
Made amends and has since become a philanthropist, philanderer or, philatelist. One of the three anyway. He’s looking to bail-out Hungary if they look like sinking into oblivion.
(Probably right now if the truth be known)
Hungary is taking it all on the chin but don’t hold your breath…see what’s to come from Italy, in the near future..o sole mio.
Anything you discover, though, I’d keep it to yourself..if you catch my drift.
Top of the world, Ma. J:Cagney
How is it possible that in a situation which can be mentioned as more than serious for Hungary your government ignores reforming iniciative and Fidesz pretends that nothing is happening? According to info from my magyar friends people already started to change forint for foreign currency due to upcomming expected situation. Forint is unstopable reaching “magical” hell border of 330HUF/Euro. No one sitting in Orszaghaza doesn´t care about the destiny of the people? Only polical voting preferences are important even in such a situation? We in Slovakia are deeply surprised! Many people feel sorry for this approach..
Fantron in terms of political relationships we are arch-enemies (due to our disable idiotic politicians). In terms of human relationships, everything is more than excellent. It would be a shame for the countries with almost similar cultures. The nearest one in Europe!
Greetings from Slovakia
Thank you Miso-SK. We return your greetings.
The currency problem from which all others stem is due to a bad decision taken by the government and National Bank. That is to say
huge currency reserves were drawn on last summer to support the forint and give it an artificial value on the world market.
This has back-fired. You see the results for yourself. More government and Bank intervention will be required if the forint is to survive.
Sorry to be late to catch uoup, folks.
“George Soros- billionaire and ex-con, banged up in France for insider-trading. Made amends and has since become a philanthropist, philanderer or, philatelist. One of the three anyway. He’s looking to bail-out Hungary if they look like sinking into oblivion.”
MY TAKE: Soros is NOT going to “bail out” Hungary. Or the United States. Never. That is definitely NOT one of the things that he does best. On the other hand, four or five weeks ago he gave a very long testimony in the US Senate on Capitol Hill. You could hear a pin drop while the guy talked. He was instrumental in placing Obama in the Oval office, so I guess Congress gives respect where respect is due.
Interesting to see the Wiki entries for Soros vs. Krazi Gyurcsany bacsi, BTW.
http://en.wikipedia.org/wiki/George_Soros
http://en.wikipedia.org/wiki/Ferenc_Gyurcsany
“People already started to change forint for foreign currency due to upcomming expected situation. Forint is unstopable reaching “magical” hell border of 330HUF/Euro.”
MY TAKE: Nopie dokie. For starters, all ‘developing’ and other Third World level countries have what is known as a “soft” currency. Folks with money in those countries — think of Central and South America, Africa, Asia here — have been parking their surplus monies in foreign currencies for ages, usually in foreign countries as well. Those Hungarians who still have some money stashed away from the prying eyes of Gyurcsany’s Tax Gestapo, the APEH, they would be wise to convert any HUF holdings to something real.
Of course, the same Hungarians who have never even been to Switzerland were for years borrowing for this, that, and the other in CHF instead of HUF, because that way they could pretend that they were already elite members of the so-called West. Whatever. We all have to pay the piper sooner or later. I am sure that the Hungarians already know that all of this was somebody else’s fault, as always. Never their own.