K&H: Most Large Companies Still Expect HUF to Weaken

The majority of large companies' managers expect the Hungarian currency, the forint to weaken further until the summer, with almost all of them adversely affected by the exchange rate change, K&H Bank told the state news agency MTI on Thursday.

According to their survey, 65% of respondents expect a weaker forint in the next six months, although 80% had planned for it in the previous quarter. They added that the exchange rate fluctuations will affect companies that export the most, as 57% of them feel the disadvantages, but 48% of companies producing exclusively for the domestic market also reported this.

Of the negative effects, the most common, cited by almost three quarters of respondents, was an increase in operating costs. The cost of materials was a problem for 65%, labor costs for 44%, and difficulties in staffing were cited by 18%, K&H added.

Feedback also showed that 29% have already done something about the exchange rate effect, while 13% are preparing to do so. Most are quoting in euros and reducing the validity period of quotes, but some are fixing payments in euros and putting their funds in foreign currency deposits, they wrote.

The survey covered non-state firms with revenues of more than HUF 2 billion. Decision-makers were surveyed between November 14 and December 5.