European Commission launched so-called “infringement proceedings” against Hungary over three issues today. Adam LeBor claims that the proposed action amounts to “a serious setback” for Hungary. However, the markets disagree.
The forint rallied up to the 309 mark from over 312.5. As the above picture shows the forint traded at 324 at its worst day, which was in 2012 January so not that long ago. Compared to that level, 309 is a significant increase.
As even LeBor admits, “Hungary sold three-month T-bills worth 55 billion forints ($226m), 10 billion more than the target and at slightly lower yields.”
So where exactly is the setback?
It should be noted that the Hungary update was once again posted by A.L.B. so “ghost” (the alleged ‘other’ Budapest correspondent for The Economist) is still yet to make an appearance.
Adam LeBor however is starting to gain some name recognition inside Hungary. http://www.mandiner.hu, a news website that also does political commentary, picked his article up as one to be showcased from today.