Orbán cabinet: Hungary maintains investment-grade rating

S+P Global Ratings has affirmed its sovereign credit ratings on Hungary, putting the country in the investment-grade category along with the other big credit rating agencies, the National Economy Ministry said late on Friday.

S+P credit ratings on Hungary

S+P, which has delivered gloomy assessments of the performance of European countries recently, revised the outlook on the ratings to negative from stable.

The government takes the position that the assessment is temporary, and a positive turnaround is expected in the second half of the year, the ministry said. The Hungarian economy rests on firm foundations, which is reflected in the credit rating agency’s assessment, suggesting the outlook could return to stable in the coming period, it added.

The ministry highlighted indicators showing the positive direction of the domestic economy, including a 17-month-long increase in real wages, growing consumption and another record year for the tourism sector. Employment stands close to 4.7 million, while the number of registered jobseekers is at a low, new and used car sales are picking up, home sales are increasing, retail lending is on the rise and the construction industry has expanded for the fourth month in a row, it said.

The government aims to put the country on a path of sustainable and balanced economic growth, the ministry said. It put GDP growth over 3pc in the second half and full-year growth at 2.5pc, while growth in 2026 is expected to be around 4pc.

The ministry acknowledged the impact on the domestic economy of weak external demand and the recession in Germany, but pointed to the growth potential of big investments underway by BMW, BYD, CATL, SEMCORP and EcoPro.

Hungary’s financing position remains stable and secure, and the government is committed to keeping strong fiscal control in place, contributing to a decline in the budget deficit and state debt levels, the ministry said. It added that a budget was being drafted that targeted a break-even primary fiscal balance.

The ministry detailed measures the government has taken to bring down inflation, including a cap on markups on a range of food products at big supermarkets and voluntary fee freezes by telecommunications companies and banks.

The government holds that Hungary is legally entitled to its European Union funding and is working to see it transferred as soon as possible, the ministry said.

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