Lira and CEE FX: Turkish Lira, Zloty, Forint — 2026-09-05
The Hungarian forint surged on September 3–4 following Bloomberg reports that the Magyar Nemzeti Bank (MNB) may halt rate cuts and lower its inflation target, pushing EUR/HUF down from 367 to near 362. In Turkey, the Central Bank (CBRT) is normalizing liquidity by resuming weekly repo auctions at the 37% policy rate, pulling the TLREF benchmark back to policy levels as markets price year-end cuts. Meanwhile, the Polish zloty remained under pressure with USD/PLN hovering around 3.72 and EUR/PLN above 4.33, reflecting broader dollar strength and regional risk aversion.
Lira and CEE FX: Turkish Lira, Zloty, Forint — 2026-09-05
Top developments
Hungarian Forint Spikes on MNB Policy Shift Rumors
On Thursday, September 3, 2026, the Hungarian forint strengthened significantly against major currencies after Bloomberg reported that the MNB is considering pausing its easing cycle. The EUR/HUF exchange rate dropped from approximately 367.81 in the morning to a low of 361.97, closing near 363.01 by evening. This sharp move suggests that domestic and international traders are repricing expectations for a more hawkish stance from the MNB, potentially signaling an end to the rate-cutting cycle that has pressured the currency throughout the summer.
CBRT Normalizes Liquidity as TLREF Aligns with Policy Rate
The Central Bank of the Republic of Türkiye (CBRT) has resumed weekly repo auctions at its 37% policy rate, a move designed to normalize funding conditions after the peak of geopolitical tensions. This operational shift has pulled the Turkish Lira Overnight Reference Rate (TLREF) back toward the policy rate, reducing volatility in short-term funding markets. Analysts at ING expect the CBRT to hold steady in September before delivering two rate cuts to 35% by year-end, a trajectory that markets are already pricing into TRY bonds and FX forwards.
Turkish Lira Real Value Declines Amid Dollar Strength
Despite nominal stability efforts, the Turkish lira’s real effective exchange rate declined in August 2026 as the U.S. dollar and euro gained ground against the TRY. The Bazaar Times reports that the lira’s real value fell as global dollar strength outweighed domestic disinflation progress. This dynamic complicates the CBRT’s upcoming September 10 policy decision, where investors are watching for signals on whether the bank will maintain the 37% policy rate or begin easing despite persistent inflation expectations.
Polish Zloty Remains Weak Against Dollar and Euro
The Polish zloty continued to struggle in early September, with USD/PLN trading at 3.7224 on September 3 and EUR/PLN staying above 4.33. The NBP’s official rates for late August showed the euro at 4.3328 PLN, indicating persistent weakness driven by strong dollar demand and cautious sentiment toward CEE currencies. Unlike the forint’s rally, the zloty lacks specific domestic catalysts for appreciation, leaving it exposed to global risk-off flows.
Local view
Hungary: Local media outlets like Világgazdaság and Portfolio.hu are heavily focused on the "leak" from Varga Mihály’s camp regarding the MNB’s potential pause in rate cuts. The narrative is that the forint’s sudden strength was a direct reaction to this political signal, with Pénzcentrum describing it as a "massive turnaround" that broke the euro’s momentum within minutes. Stakeholders are now waiting for official confirmation from the MNB, which could either cement the gains or lead to a correction if the rumors are denied.
Turkey: Turkish financial media, including Sözcü and Mynet, are positioning the September 10 PPK meeting as critical for determining the path of "hidden" interest rate adjustments. Sözcü notes that while the headline rate remains at 37%, the resumption of repo auctions effectively lowers the funding cost for banks, acting as a de facto easing measure. Investors are watching whether this operational tweak will be enough to stabilize the lira or if further direct interventions will be needed.
Context & numbers
- EUR/HUF: Moved from ~367.81 to ~361.97 intraday on September 3, 2026, before settling near 363.01.
- USD/PLN: Recorded at 3.7224 PLN on September 3, 2026.
- EUR/PLN: Held above 4.33 PLN, with NBP fixing at 4.3328 PLN on August 28.
- TCMB Reserves: Total reserves fell by $251.59 million in the week ending August 28, 2026, to $188.2 billion, driven by a $3.1 billion drop in foreign currency reserves.
- Policy Rates: Hungary’s base rate was cut to 5.50% in August; Turkey’s policy rate remains at 37%.
On the radar
- TCMB PPK Meeting (September 10, 2026): The Central Bank of Turkey will announce its sixth monetary policy decision of the year. Markets are watching for any shift in guidance regarding the timing of the first rate cut from the 37% level.
- MNB Inflation Target Review: Rumors persist that the Hungarian National Bank may lower its inflation target from 3% to 2.5% in its upcoming communications. Confirmation or denial of this rumor will be a key driver for HUF volatility in the coming days.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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