The five-year CDS premium - a major country risk benchmark - has fallen to 98 points, signalling that market investors appreciate achievements of the Hungarian economy and are upbeat concerning the country’s outlook.
According to kormany.hu, the Hungarian economy has been on a steady growth track since 2013. GDP data shows a stable economic structure, growth based on multiple pillars, with almost every sector contributing to it.
Official figures show that economic growth has not generated debt. In fact, the government's annual budget deficit has been firmly below the 3 percent threshold in recent years, and the indicator has improved more markedly than others in the EU.
Government sources say the improvements are thanks to a prudent fiscal policy, sensible debt management and economic expansion. In the first seven months of 2017, external trade posted a surplus of 5.2 billion EUR, as a result of which the current account showed a surplus of 5.8 percent of GDP in the second half of 2017.
In recent years, international institutions and credit rating agencies have come to recognize the results of the Hungarian economy.
Market investors have long held a positive view of the country, as the persistent decline in bond yields and CDS premia show.
Hungary has been on the right path with an encouraging economic outlook, underpinned by the six-year wage agreement, tax cuts and the government’s competitiveness-boosting measures.