Government bond yields in the negative
Hungary’s economic growth and future outlook have convinced market participants that it was worth investing in the country
The interest Hungary paid on money borrowed has fallen to historic lows, it has been revealed.
According to Mihály Varga, minister for National Economy, since Hungary began borrowing, it has been unprecedented that creditors actually paid the state for the loan. "It is a great moment," he said.
The minister said that Hungary’s economic growth and future outlook have convinced market participants that it was worth investing in the country.
At an auction on Tuesday, the Hungarian Government Debt Management Agency sold Discount Treasury Bills of 15 billion HUF (50 million HUF) at a yield of -0.02 percent, an historic low.
According to kormany.hu, the minimum, maximum and average yields of the bids were all negative, while the offered bonds were three times oversubscribed.
The minister said Hungary's state budget was stable and sound, the debt-to-GDP ratio was declining steadily, and the share of state securities held by non-residents was also falling. Negative yields seen at the latest action are expected to persist.