Hungary central bank to factor in stronger forint

Hungary's central bank will have to be "mindful" of gains in the forint and easing market tensions when it decides on rates this month, Deputy Governor Ferenc Karvalits said on Monday, signalling a dovish shift from January when he sought a hike.
Karvalits, who was outvoted last month along with the bank's governor and another deputy governor, said they had argued for a hike to support Hungarian assets while the government undertakes what could be prolonged and risky negotiations on a financing deal with the IMF and European Union. Rates were kept on hold after four rate setters appointed by the government last year outvoted Governor Andras Simor for the first time at the January meeting, halting a tightening cycle and exposing a clear division in the Monetary Council. They argued for a wait-and-see approach until an agreement is reached with the lenders in talks that may start next month.