HUF/USD Outlook: Slightly positive, but likely to move sideways, as the rate is above its recent average but lacks one clear driver.
Key drivers:
- Rate gap: The National Bank of Hungary's interest rate is higher than the Federal Reserve's, which supports the forint.
- Risk/commodities: The US dollar is under pressure due to geopolitical tensions and a declining trend in the market, contributing to the weak dollar outlook.
- One macro factor: A slowdown in US economic growth, coupled with expectations of more rate cuts from the Federal Reserve, adds to the bearish outlook for the dollar.
Range: The HUF/USD rate is likely to hold within its recent 3-month range of 0.002957 to 0.003170, showing limited volatility.
What could change it:
- Upside risk: A stronger-than-expected recovery in Hungary's economic growth could boost the forint.
- Downside risk: Further escalations in geopolitical tensions affecting the US could weaken the dollar significantly.