Forint reaches new record low against EUR

The Hungarian forint plummeted yesterday to a new record low against the euro, Mediafax reports. Thus, the exchange rate rose to HUF 319.4/EUR following rumours that the negotiations between the Hungarian government and the international financial institutions would not be completed by mid-year. The forint is ebbing by 1 pc in Budapest, to HUF 319.11/EUR. The preceding record low was set on November 14, at HUF 317.92/EUR. The yield of Hungarian bonds with a ten years’ maturity term rose on Wednesday on the secondary market by 0.32 pc to 10.69 pc, the highest yield since April 2009. In December the European Commission (EC) and the International Monetary Fund (IMF) interrupted negotiations with the Hungarian government as they were disgruntled with a number of laws adopted by the Budapest Executive, which were debated in Parliament at the time, mainly, by a bill that undermines the central bank’s independence and enhances the government’s control on the monetary policy. The laws were adopted by the Parliament on December 30 and the spokesman for the EC. Olivier Bailly, stated on Tuesday that the EU executive had no intention to resume negotiations with Hungary at this point.

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