Hungary Cuts Near End Amid Contagion Threat: East Europe Credit
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Hungary is winding down interest-rate reductions after 20 straight months of cuts as contagion from neighboring Ukraine left the nation’s bonds the worst emerging-market debt after Russia and Turkey this year.
The forint had its biggest intraday gain in three weeks as the central bank said rates were approaching a level consistent with its 3 percent inflation target after lowering the benchmark to a record 2.6 percent, as predicted in a Bloomberg survey of economists. Hungarian bonds lost 3.8 percent this year in dollar terms through yesterday, surpassed only by ruble and lira securities among 32 nations in the Bloomberg Emerging Market Local Sovereign Index.