S&P Global Ratings has adjusted its forecast for Hungary, shifting it from ‘stable’ to ‘negative’, while maintaining the country’s debt rating at ‘BBB-/A-3’ for both long- and short-term foreign and local currency commitments. This shift comes amidst escalating threats to fiscal stability. According to the rating agency, “The challenges posed by volatile external economic conditions, uncertainty surrounding EU financial inflows, and the resurgence of inflation are complicating policy decisions in Hungary, elevating the risk of stagflation.” The negative outlook underscores the growing threats to Hungary’s fiscal and external stability over the coming two years. Contributing factors include increased trade protectionism, diminishing global demand, reduced capital inflows, and heightened interest expenditures amid pre-election fiscal expansion. Meanwhile, Moody’s continues to rate Hungary at Baa2 with a negative outlook.
The material has been provided by InstaForex Company – www.instaforex.com
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