Hungary budget deficit at end-Q3 2.0 pc of GDP

The net financing requirement of the budget, which is a good approximation of the budget deficit, was 910 billion forints (2.71 billion euros) or 2.0 percent of GDP in the four quarters to the end of Q3, the National Bank of Hungary (NBH) said on Monday concerning preliminary data of Hungary’s financial accounts.

General government net borrowing was 228 billion forints in the third quarter itself, equalling 1.9 percent of quarterly GDP.

Hungary’s state debt stood at 66.4 percent of GDP at the end of September, down from 66.5 percent at the end of June and from 70.2 percent a year earlier.

State debt, including Eximbank data, was at 68.1 percent of GDP at the end of September, down from 68.2 percent at the end of Q2 and from 72.0 percent in Q3 2018.

Hungary’s constitution requires the year-end debt-to-GDP ratio to fall each year until it reaches 50 percent.

The NBH in 2018 started publishing separate state debt ratios, with and without the balance sheet of Magyar Eximbank, in line with a decision by Eurostat. Eurostat has for years maintained that Magyar Eximbank should be reclassified inside the general government sector, raising state debt.