Hungary’s rating of general government debt, „BBB-” with stable outlook, was affirmed by the international credit rating agency.

Thanks to the implementation of a disciplined fiscal policy and the improvement in economic performance, first the market perception of the country had improved substantially, and in 2016 rating agencies have also recognized the achievements.

The first one to upgrade the country’s debt was Fitch Ratings in May 2016, followed by S&P’s on 16 September and Moody’s on 4 November. As S&P’s has revised the country’s debt rating in September 2016, and rating agencies do not usually announce another upgrade at the very next publication date, no improvement has been expected this time.

It is clear that markets see the country in a more favourable light than credit rating agencies do, and market stance is signalling further improvement in debt ratings.

All three major rating agencies now keep Hungarian government securities in investment grade category, which also indicates that Hungarian economic growth has been strengthening.

The investment grade status is an official threshold for many international financial companies: the Government Debt Management Agency may draw resources from a wider range of institutions for better conditions. Since the S&P’s decision last year, the second upgrade, demand has risen on the securities market, which is causing yields and the interest expenditures of the government budget to decline, but debt financing is also becoming more stable.

(Ministry for National Economy)