New survey reveals strong public support for owner-occupied housing and family tax breaks available to all parents, especially among young and rural populations.Continue reading
The Hungarian currency gained two points against the dollar in response to the latest U.S. inflation data for July. The forint gained significant momentum on both major fronts in response to the figures, reported VG.hu.
The fresh July U.S. CPI inflation data shook up the currency market, reporting a milder-than-expected annual price increase of 2.7 percent instead of 2.8 percent for the broader basket. What made the fresh data really interesting, however, was that the core inflation rate, adjusted for volatile elements, came in above expectations at 3.1 percent instead of 3 percent.
Investors concluded from the latest U.S. data that inflation had not risen significantly despite the trade war, as the broader basket indicator showed a price increase of only 2.7 percent, opening the door wider for the Fed to cut interest rates. Before the latest data, the market gave an 86 percent chance that the Fed would cut interest rates by 25 basis points at its next meeting in September – after the latest figures, these odds crept even higher, with the probability of an interest rate cut at 94 percent after the CPI.
The downward shift in interest rate expectations was immediately reflected in the foreign exchange market: the DXY dollar index fell 0.35 percent almost immediately, the euro strengthened 0.4 percent against the dollar, and the forint jumped even higher, gaining 0.5 percent in a matter of minutes,
causing the greenback to fall from 341.2 to 339.5.
Via VG.hu; Featured Image: Pixabay