GBP/HUF Outlook:
Slightly weaker, but likely to move sideways as the rate is below its recent average and lacks a clear driver.
Key drivers:
• Rate gap: The Bank of England's dovish stance is contrasting the National Bank of Hungary's stable interest rate, supporting the forint.
• Risk/commodities: Oil prices are fluctuating around average levels, which could impact overall market movements, although neither currency is directly tied to commodity prices.
• One macro factor: Market expectations are leaning towards a rate cut from the BoE by mid-2026, which is contributing to pressure on the pound.
Range:
GBP/HUF is likely to drift within its recent range, which has been stable and tight.
What could change it:
• Upside risk: A stronger than expected performance in upcoming UK GDP data could boost GBP.
• Downside risk: Continued political instability in the UK could further weaken GBP against HUF.