The current market bias for GBP to HUF is bearish. The interest rate differential is shifting, as the Bank of England is expected to cut rates further due to slowing inflation and growth, while the Hungarian National Bank maintains a tighter stance. Recent inflation data indicate rising pressure in Hungary, with core inflation exceeding projected levels, suggesting delayed rate cuts too. Economic growth concerns in the UK are heightening with forecasts of dwindling expansion.
The GBP to HUF exchange rate is expected to remain within a stable range as recent trades show significant support around 440.7, just below the three-month average.
Upside risks could stem from unexpected improvements in UK retail sales, potentially bolstering the pound. On the downside, further fiscal pressures in Hungary could reduce confidence in the forint, leading to its depreciation against the pound.