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Well, the Hungarian forint really did prove that it’s the worst-performing currency in Europe. The EURHUF has reached all-time highs in today’s trading sessions, and it is expected to continue rising unless the Hungarian central bank tightens its ultra-loose monetary policy. Last week, the National Bank of Hungary decided to hold on to its current base rates at 0.9% and its overnight deposit rate at -0.05%. The central bank appears that it won’t change its rates anytime soon especially as the economic growth of the country is expected to slow down next year. In a committee hearing, the central bank governor, Gyorgy Matolcsy admitted that there are now signs of overheating in some of the industry. But Matolcsy added that Hungary’s economic growth as a whole isn’t overheating yet. Budapest’s economic growth for the third quarter went up by 5% on a Year-over-Year basis, surpassing experts’ expectations.
The EURCZK is expected to continue to go down in trading sessions as more experts expect the Czech central bank to tighten its monetary policy in the next meeting. This comes in contrast to other central banks in Europe who are opting to maintain their loose monetary policies as the region’s economic growth is reportedly slowing down. However, that is not guaranteed as the Czech Manufacturing Purchasing Managers’ Index may have recorded improvements, it is still below the mark that separates contraction from expansion. Meanwhile, the single currency is pinned down by traders who are moving cautiously as the economic outlook of the bloc stays bleak in the near term. Improvements in the German business sector may have shed a little hope on traders, it’s still not enough to cause a breakout as business growth in the whole region also remains at stagnant this November.
The US dollar to Russian ruble pair first fell in today’s sessions but it quickly managed to regain its footing and continue with its rally. The US dollar went up following the announcement of the Chinese Ministry of Commerce earlier. According to their statement, the Chinese Vice-Premier and officials from Washington had another phone conversation about the core concerns of each camp regarding the trade deal. Chinese state-owned media said that the sides addressed and came up with ways to reach a consensus during the phone call. If significant progress continues to breakthrough, the USDRUB is expected to hit its resistance in the earlier part of December. However, the Russian ruble will continue to resist as it will gain support from the payment of income tax on Thursday. Although, the oil and petroleum production, one of the biggest causes of the ruble’s strength, is at risk due to possible reductions in OPEC+’s output.
The Canadian dollar is in hot waters against the US dollar as the currency fails to get support from the positive wholesale trades report released this week. The Statistics Canada reported that the wholesale trade of country bounced back from a 1.2% contraction in August to a 1% increase in September. The figures even went beyond expectations of about 0.3% to 0.4% growth by analysts. In total, Ottawa’s wholesale trade went up to $65.1 billion in September thanks to the boost it gained in Canadian machinery, supplies, and equipment subsector. Aside from that, the ongoing strike at Canada’s national railway is pinning pressure against the loonie. As of writing, the strike is on its seventh day, and experts say that it’s starting to have negative effects on Canada’s economy. Experts are also waiting for the intervention of the federal government to order the over 3,200 members of the Teamsters to get back to work.