Topic: Hungary HUF Interest Rate May 25 2021
Hungary HUF Interest Rate May 25 2021
What does the data mean to the market?
The Hungarian National Bank Monetary Policy Committee's decision on where to set the benchmark interest rate. Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation.
A higher than expected rate is positive/bullish for the HUF - (Hungarian Forint), while a lower than expected rate is negative/bearish for the HUF.
Historic deviations and their outcome
June 29 2020 We got a negative -0.15bps (basis points) cut to the interest rate which gave a nice slow move on USDHUF, with many opportunities to enter the market!
See the price action here
I will use forecasts of:
Base Rate Announcement 0.6
Today's trade plan
Economists expect a series of rate hikes throughout the rest of 2021, with the first increase of 0.15bps to the interest rate expected to happen in June, followed by 25bps hikes in September and December.
Today If we see that expected series of increases brought forward, I will take a sell on USDHUF, so I am looking for a +0.15bps increase or more to sell USDHUF (Meaning I'm buying the HUF) and expect some continued HUF Strengthening.
Hope this helps but please do your own analysis!!
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