The Hungarian national forint currency has plunged in value following statements by Prime Minister Viktor Obran regarding the war in Ukraine.

Today, May 23, the HUF fell immediately by 0.9% of the cost and dropped to 377.2 forints per euro, which was the worst indicator among developing countries, writes Bloomberg.

The publication reports that such a sharp drop is due to the Hungarian Prime Minister's statement that he does not believe in Ukraine's victory in the war, and also that Budapest opposes providing assistance to Kiev.

In addition, Orban's position may delay financial assistance from the European Union, which may negatively affect the development of the Hungarian economy.

Also, the fall in the currency was influenced by the decision of the Hungarian Central Bank for the first time since the beginning of the year to reduce the discount rate by 1 percentage point to 17%.

"The rate cut will make the forint more sensitive to negative news related to both internal and external factors," said Petr Mathis, senior currency analyst at In Touch Capital Markets.

The set cut key rate at 18% attracted investors, which caused the forint to strengthen against the euro by 6% since the beginning of this year.

We will remind, earlier it was reported that the head of the Ministry of foreign Affairs Peter Szijjártó accused the President of Ukraine of trying to undermine the national sovereignty of Hungary.

In addition, we previously reported that before February 24, 2022, Hungarian military were near the western Ukrainian border. Then military pontoons were also brought to the border.

Read also:

  • "We will continue to bend our line": why Hungary impedes Ukraine's work in NATO
  • Hungary threatens to block military assistance to Ukraine from the European Union
  • Orban said that the European Union and NATO "have become a de facto party to the war in Ukraine."

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