The Hungarian forint, which suffered severe losses as its country plunged in one of the deepest recessions among the European Union member nations, reached a six-month high after the Hungarian tax system will change in order to stimulate the countrys agonizing economy.
The Hungarian currency hit its highest level since January 8, after lawmakers approved tax cuts as an attempt to rescue the nations weakening economy, spurring demand for the local currency which was the best performing currency among the European ones this Wednesday, rising more than 1 percent against the euro. The BUX Index, rose 44 percent during the past three months, reflecting a very attractive rebound for Hungarian stocks, which have been severely punished by the global slump, and in the case of this Eastern European nation, even further, since Hungary had to get an emergency loan from the International Monetary Fund last year, in order to avoid a total financial system collapse.
Analysts are very optimist about yesterdays reforms voted in Hungary, since tax cuts are one of the most efficient ways to stimulate the economy without major collateral effects. Hungary has been fit to the IMF requirements, and the nation seems to be in the right road to recovery, boosting demand for the once again attractive forint.
EUR/HUF traded at 272.6059 as of 12:15 GMT, falling from 275.1805 yesterday.
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