Forint Weakens Second Day on Greece Rating Risk, German Data
Hungary’s forint weakened a second day amid concern Greece’s credit rating may be cut and as German industrial output contracted, cutting investor appetite for riskier, emerging-market assets.
The currency depreciated 0.2 percent to 277.49 per euro by 4:36 p.m. in Budapest. The yield on government bonds maturing in 2022 rose seven basis points, or 0.07 percentage point, to 7.499 percent.
Greece may be cut again by Standard & Poor’s after the rating agency revised to negative the outlook on the country’s CCC ranking, already eight levels below investment grade. German factory output fell 0.9 percent from May, the third set of data this week to signal Europe’s largest economy is cooling as the sovereign debt crisis erodes demand for its goods. Germany is Hungary’s largest trading partner.
Developments in the euro area will be “decisive for the forint” today amid the intensifying risk aversion, Commerzbank AG analysts led by Peter Karsai in Budapest said in an e-mailed note to clients today.
To contact the reporter on this story: Edith Balazs in Budapest at firstname.lastname@example.org
To contact the editor responsible for this story: James M. Gomez at email@example.com
Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.