Turbulences

In Hungary the euro/forint exchange rate seems to have stuck above 310 – in perfect harmony of the interest of high politics. The government’s representatives said the weak forint isn’t a problem as it supports export and our foreign trade balance improves.

After cut the base rate is now 2.6 percent. On the international stage last year was all about purchasing bonds, but this year the Fed reduced its purchases and the foreign exchanges of upcoming markets are characterised by turbulence. The dollar also weakened but that further backed the price of raw materials. However, if the situation keeps escalating in the Ukraine, there is a chance that raw material prices will be skyrocketing. What is more, the Fed might trim its stimulus polices further at the end of March. In Hungary it could happen that the forint and government bonds will be sailing through rough waters. And in early April there will be parliamentary elections – please fasten your seatbelts!