USD/HUF: Hungarian Forint Strengthens On Employment Data, Covid-19 Fears Hit USD

The US dollar is tanking lower versus the Hungarian forint on Thursday on coronavirus outbreak fears. Meanwhile the forint is pushing northwards as the Hungarian unemployment level continues to hover close to record lows.

At 09:15 UTC the US dollar Hungarian forint exchange rate is trading at 310.07, -0.65% after hitting a weekly low of 309.69 earlier in the session. The pair has wiped out all gains for the week and is currently off -0.25% week to date.

Hungary In State Of Full Employment

Official data showed that the unemployment rate in Hungary remained close to record low levels in January. The unemployment ticked 0.1% higher to 3.5%. This is in line with the annual rate of 2019 which was 3.5%. Economists broadly consider Hungary to be in a state of full employment, so it would be challenging for the number to drop much from here. The broad expectation is that it will stabilise around this level. Wage growth continues to rise.

A strong labour market boosts consumption which is good news for the economy and inflationary pressures. As a result, the forint is pushing higher.

Investors will now look ahead to Hungarian GDP data due tomorrow. Analysts are expecting economic growth of 4.5% year on year in the final quarter of 2019.

Coronavirus Fears Hit US Dollar

The US dollar is trading on the back foot in early trade on Thursday amid growing anxieties surrounding the coronavirus outbreak. The first cases of coronavirus from an unknown origin in the US has boosted fears that this could soon turn into a pandemic.

The US dollar is tanking as investor grow increasingly more convinced that the Federal Reserve will need to cut interest rates in order to support the economy. According to the CME Fedwatch, investors are now pricing in a 41% probability of a rate cut in March. This was just 23% at the beginning of the week.

Looking ahead the dollar could come under further pressure with the release of US durable goods data. Analysts are expecting durable goods orders to decline -1.5% month on month in January, down from a 2.4% increase the previous month. US GDP data is expected to show that the US economy grew 2.1% annually in the fourth quarter.

Currencylive.com is a news site only and not a currency trading platform.

Currencylive.com is a site operated by TransferWise Inc. (“We”, “Us”), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of TransferWise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on currencylive.com do not represent our views.