The pound, the base currency of Great Britain, divided (since 1971) by the decimal amount of one hundred pence. This term came about because about 775 silver coins known as “sterling” were issued in Saxon kingdoms, two hundred and forty of which were minted by a pound of silver metal. As a result, large payments were called “pounds sterling,” after which this name was changed or reduced to “pounds.” When the Norman Conquest took place, the pound was divided for accounting purposes into twenty shillings and two hundred and forty pence. Medieval Latin documents used the words pound to use sterling, scales, solidus, and denarius, shilling, and pennies, which facilitated the use of the symbols £ if d.
In 1971, the pound was officially converted to one hundred new pence. The pound symbol was saved for the pound, and the letter p was chosen for the new penny. Since 1992, the pound has been in free movement, although the government has tried and managed to maintain inflation in general by European requirements. In October 1992, the target range for the currency was initially set at zero to four percent but was later revised by the new Labor government of Tony Blair to 2.5 percent with a one percent band on both sides. This was a unique achievement, given that Britain is prone to inflation and seems to portend a new economic convergence with Europe.
The Hungarian National Bank issues forint, as the official currency of Hungary. The name of the money itself comes from coins that were minted in Florence in 1252 and called Fiorino d’Oro. Banknotes and coins made of silica florin were introduced and distributed in 1946, as an essential step to stabilize the country after the Second World War. Due to inflation (especially in the late 1980s), trend coins ceased to be relevant and were withdrawn. This happened in 1996. Currencies continue to be minted in Florin’s bills. After high inflation in the 1990s, when Hungary switched to a market economy in 2001, the forints became convertible.
On the GBP/HUF currency pair, the US dollar has a significant impact. Because the combination of GBP and HUF currencies correlates with the American money, it is considered a pair of cross-rates. In this regard, by analyzing the combined price charts of the GBP/USD and USD/HUF pair, traders receive the corresponding price chart for the GBP/HUF pair.
The dollar very significantly affects both the pound and the forint, which are represented in the analyzed pair. As a result, economic events and the political situation in the United States, from the point of view of interest rates, estimates of unemployment, increase or decrease in the number of jobs, from the point of view of the “newly created” ones, look like those that influence the correct determination of quotation changes.
Thus, all events occurring in the US economy can affect the exchange rate in different ways, and the GBP/HUF pair is a kind of indicator or signal of the currencies that make up the pair. The Hungarian economy is heavily dependent on foreign organizations located in the country because it has abundant stocks of coins from other countries.
A very highly developed economy also characterizes the country. Economic development is based on industries such as engineering, metallurgy, and the chemical industry. Moreover, Hungary has well-developed gardening, winemaking, as well as the agricultural sector. A significant part of the products is exported to the country. Tourism makes a significant contribution to the economy: millions of tourists come annually to look at historical places, attractive picturesque pictures of nature, to study ancient architecture and traditions.
To trade GBP/HUF, it is essential to monitor the performance of the economies of the EU and Russia, because, for Hungary, these countries are crucial partners in foreign trade. Also, of course, it should be borne in mind that brokers can set a slightly larger spread for this pair than for others – essential or popular. Therefore, before trading this pair, the trader should study and analyze all the conditions that the broker of his choice for this asset offers.