Hungary central bank holds rates: Can USD/HUF break Ft318.8262 resistance?

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US Dollar vs Forint up 0.58% today

Highlights

Hungary's central bank will keep its benchmark interest rate at 5.5%, pausing its easing cycle after three consecutive cuts.
Policymakers are evaluating a potential reduction in the official inflation target, but no formal change has been made.
USD/HUF shows short- and medium-term bullish momentum with price expected to hold between Ft315.6538 to Ft318.8262 over the next several days.

Policy rate pause curbs Forint pressure as easing cycle halts

Hungary's central bank will maintain its benchmark interest rate at 5.5% at the upcoming policy meeting, according to Bloomberg, halting its easing cycle after three consecutive reductions. This decision indicates a pause in monetary loosening, preserving current yield levels on Forint assets and limiting downside pressure on the Hungarian currency. Additionally, policymakers are evaluating the possibility of lowering the inflation target, but no formal change has been confirmed.

Mixed momentum signals as technical supports stay intact

On the h1 timeframe, USD/HUF sits above both the MA-20 at Ft315.4743 and the MA-50 at Ft316.2302, while on the daily chart it also holds above the MA-200 at Ft316.965. The Ichimoku Kijun on the daily timeframe stands at Ft315.6334, providing immediate support. Momentum readings are mixed: MACD prints a strong sell, the ADX is neutral, while the RSI at 57.287 and Stochastic RSI both register a buy. In contrast, CCI and Bull/Bear Power both show overbought and buyer-dominant signals, and the Awesome Oscillator remains neutral, not confirming any pronounced trend.

High upside risk as volatility tightens within defined range

For the next two to three trading days, USD/HUF is expected to fluctuate within the Ft315.6538 to Ft318.8262 band, reflecting typical volatility near current levels. The probability of an upward move is assessed as very high, whereas chances of a decline are very low. Baseline scenario calls for continued sideways trading inside this range; a bullish breakout would see price press above Ft318.8262 and target new highs, while a reversal below Ft315.6538 would indicate a shift toward lower support.

Viktoras Karapetjanc, expert at Traders Union, sees fundamentals supporting the Hungarian Forint as the central bank holds its interest rate steady. He notes resilient buyer demand and a contained risk of depreciation with the pause in policy easing. Technical signals are mixed, but momentum indicators lean towards further upside. The analyst expects USD/HUF to trade within a tight range, with a strong probability of an upward move. "As long as USD/HUF holds above Ft315.6538, I anticipate bullish momentum to persist with potential for new highs if resistance breaks."

Previously it was reported that bullish momentum persisted for USD/HUF, underpinned by positive technical signals despite the presence of overhead resistance. The latest market developments add a new dimension, as the central bank’s policy pause and mixed momentum readings suggest close monitoring of the upper boundary at Ft318.8262 is warranted for any imminent breakout.

Source of Data: USD Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.