The fiscal deficit continued to normalise in May

HUNGARY - In Brief 09 Jun 2022 by Istvan Racz
New central government cash data suggests the government is serious about its promise to fix the budget on rather short notice after the election. In May, the cash deficit was only 2.1% of GDP on annualised basis. As a result, the cumulative January-May deficit fell to 11.3% of GDP, from 13.7% in January-April and a peak 16.2% in Q1. Detailed figures for April shows that following the election on April 3, the fiscal broom and mop were quickly activated, to sweep in and mop up unused funds here and there at budgetary institutions. The new extraordinary taxes will arrive in July, so that a full-year amount will be collected already this year. New FX bond issues by the Treasury were announced today, with 7-12 year maturities. The total size of the three bonds is $3bn and €750m, which is the equivalent of 45% of this year's deficit target. However, about one-third of the proceeds is intended to be used to refinance existing FX debt. These issues do not necessarily look cheap, with 2.4-3.225%-points above UST/Bund, but it may be actually a good idea to fix the cost of debt at a time of rising interest rates and bond yields.

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this or its contents.