Forint Slide Accelerates As Hungarian Default Risk Now 14 Wider To 277bps

Tyler Durden's picture

Poor, poor Europe. Every room one shines a light in, the cockroaches don't even bother to scurry to safety any more. Yet what is glaringly obvious takes a media-reported soundbite to awake people. So is the case with Hungary today. After opening 7 tighter, Hungarian CDS are now 14 bps wider to 277bps. As the attached chart shows, the Hungarian Forint is now in freefall. Yet if investors are concerned about Hungary, they should take a look at some of its less lucky Eastern European neighbors which, just like Hungary, have been considered to be strong for so long.

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Crab Cake's picture

EUR-USD 1.2199

Awaiting the third ramp job of the day..... Wait for it...

ZeroPower's picture

1.2188 looking like s-t low for now

jeb3's picture

Here comes the 1.2150 retest.  I really think they'll support this level at ANY cost currently.  Only time will tell tho...

Rusty_Shackleford's picture

Come one Gentle Ben.  1.2153!!!!!    Are you sure your keyboard is even plugged in?

Jiggle the cord!!!

doolittlegeorge's picture

this really is funny.  What did "Big Helmet" say in the movie Space Balls?  "Did you see me playing with my toys?"  And the response?  "No, sir, I did not see you playing with your toys."  And evil Big Helmet responded, "Goooooooddddddd." 

MrTrader's picture

Hum...I am long EUR/HUF, no idea why ANYONE is playing EUR/USD...????

steve from virginia's picture

Watching this and reading between the lines it seems the IMF- bailout/deflation medicine is backfiring in Hungary, the poster child for austerity in Eastern Europe:


So- called 'Growth' in Hungary is hoped to be .5% this year, far insufficient to outpace debt service costs. Rather, IMF enforced austerity pulls debt service farther out of reach.

trav7777's picture

Ironically, the rate regimes in various nations were intended to INVITE a carry trade to bring credit into their economies.

They welcomed being the new South Seas.

This will be their undoing now as the fictitious capital all sloshes back out.

carbonmutant's picture

Looks like Hungary’s Government Debt Management Agency had to cut their bond auction.


SDRII's picture

Cant be good for Unicredit and or Austria

Cyan Lite's picture

Is 14bps really that much of a difference? 

LeBalance's picture

as Dburger says below Yes. lol, just try making a budget or being rational about debt service, or for that matter attracting buyers to your debt service with that level of increased cost, volatility, and therefore uncertainty and lack of ...wait for it... Confidence.

Aka Ka-BOOM!

Deflationburger with Fleas's picture

Its a 5% move in one day.  Yes it is.

Zodiac's picture

Let's all welcome the new grouping of similarly positioned countries -- the PHIIGS.

Eat your heart out Jim O'Neill.

firstdivision's picture

You forgot Austria.


In other news CNBC says to "buy eastern euro debt".

Rusty_Shackleford's picture

...and private mortgage backed securities.

They've got fantastic cash flow.......


I swear to God some guy just said that as I was walking past the TV.

PhD's picture




bugs_'s picture

Soros home plate.

doolittlegeorge's picture

It's actually pretty funny.   It was the S Koreans who coined the phrase "I Am Phucked" as the real acronym for IMF.  Needless to say the Euro-phags were pounding the table back in 98 to "throw Asia under the bus" and they used "their" IMF to do it.  Weeellllll isn't turnabout a real phukin' good time!  I know--maybe the world could ask of all those Nancy's over there for some real population growth!  Never have a people been so afraid of the word "family" since probably Ghengis Khan.

AnAnonymous's picture

Is the IMF the US or Europe? because when the IMF is bailing out the world, that is the US. When the US screws the world, that is Europe.

Truth's picture

Gold $1300 here we come....

trav7777's picture

yeah, just fell off a $20 cliff.


Truth's picture

if you're day trading, bummer.  longer term however, dollar likely to peak soon and then attention to turn to U.S. and watch the dollar begin/continue it's death walk.  i'll take the two steps forward, one step back price action. 

trav7777's picture

Debt, as we know it, or "money," take your pick, is retreating from the reaches of the earth to its source.

It's flooding out of developing economies and repatriating to the carry sources, Japan and the US.

Oil at these price levels (reflecting decline in supply) is slowly strangling the last vestiges of marginally economical activity in the BFE countries of the world.

The low-hanging fruit is all gone.

carbonmutant's picture

Squeeze the turnip is next...