Will he, won’t he… get it?
That was the question on Magyar political analysts’ lips on Monday – he being Viktor Orban, Hungary’s go-go, rapid-fire prime minister, “it” being the two-thirds parliamentary vote he most definitely covets for a “super-majority” again during his second term in office.
He’s on the brink – it depends on a few thousand votes cast outside the country or in other districts. But regardless of this, the one time anti-communist student firebrand is sure to be at the helm in Budapest for four more years, and still with a commanding parliamentary majority. Continue reading »
Has the Great Magyar Rate-Cutting Cycle come to an end? To many, it looks that way, following the central bank’s decision on Tuesday to snip just 10 basis points off the base rate, to leave it at 2.6 per cent a year.
And even this trim, the smallest made so far in a 20 month long trimming spree, is possibly more symbolic, an effort to keep up the momentum in front of elections, scheduled on April 6, just 12 days hence. Continue reading »
Viktor Orban, Hungary’s populist prime minister, has promised a continuation of the policies enacted in the past four years if his Fidesz party wins the country’s general elections, set for April 6.
Orban – who is well ahead in opinion polls against a left-liberal coalition cobbled together at the eleventh hour – told the Hungarian chamber of commerce on Wednesday “we’ll [just] continue,” before spelling out a 10 point economic programme that includes pledges to increase the proportion of domestically held government debt, accelerate industrialisation, boost Hungarian ownership in the banking and agricultural sectors and further decrease energy costs to support Hungarian competitiveness. Continue reading »
Inflation watching in Hungary is getting tiring on the eyes: following an unprecedented zero change in prices in January, annual inflation crept up by a whole 0.1 per cent in February, according to figures released on Tuesday.
The figures reinforce the belief that the central bank will continue with its marathon rate-cutting cycle with at least one more cut later this month. Continue reading »
Slovenia finished February on a surprise high, with news that the economy in the fourth quarter of 2013 expanded by 2.1 per cent year-on-year – the first three months of growth after eight consecutive quarterly declines.
The late upturn, however, proved insufficient to pull the year’s performance into positive territory. Grim data earlier in the year – the first three months was 4.6 per cent down on 2012 – meant the economy in 2013 contracted by 1.1 per cent. Still, that’s a whole lot better than the 2.5 per cent slump in output for 2012. Continue reading »
Only last week, Nomura’s Peter Attard Montalto warned that Hungary’s central bank “appears to be playing with fire” in its insistence that “Hungary is different” and that – with inflation at all time lows – it can continue its rate cutting policy regardless of the bigger world out there.
Montalto published that on Thursday, when the forint had recovered from the worst of the buffeting it received earlier in the week, to trade in a range around Ft308 to the euro. Continue reading »
The markets just aren’t reading the script, it seems. On Thursday the Hungarian economy ministry issued its latest upbeat economic release: “The number of people in work exceeds 4m” – that’s 235,000 more in work than when the Fidesz government took over in 2010, it announced in triumph. Minister Mihaly Varga was equally upbeat in a guest post on beyondbrics this week.
So if Hungary is in such good shape, how come the forint has been so badly hit? Continue reading »
The Hungarian forint set off on a roller coaster ride on Wednesday, buoyed at first by optimism and then buffeted by a sell-off across emerging market currencies, exacerbated by dovish signals from policy makers at home. The forint fell to as much as Ft310 to the euro, its weakest level in more than a year and a drop of 2.1 per cent from Tuesday’s close of Ft303.6. Continue reading »
Mihaly Varga, Hungary’s economy minister, may champion a recent turnaround in his country’s economy and the unorthodox methods he argues have achieved it. But coincident with his guest post on beyondbrics on Monday, the OECD released its latest report on Hungary.
It warns that Hungary will struggle to achieve anything beyond “meagre” economic growth unless it addresses a long list of issues, including the creation of a more predictable tax and business environment, stronger, more effective and even-handed treatment by regulators and competition agencies, and support for the banking sector to lend at commercially competitive rates. Continue reading »
New year, new cut: Hungary’s central bank trimmed its base rate by 15 basis points to 2.85 per cent on Tuesday, a move that surprised analysts only by its size – being the first of its kind after the monetary council turned to 20 basis point cuts in the second half of last year. It brings Hungary’s policy rate to yet another all-time low, down from 7 per cent when the bank starting cutting in August 2012, as inflation stays under control and growth remains a concern. Continue reading »
Viktor Orban, Hungary’s prime minister, along with his Fidesz government, have been remarkably busy this week. They have been talking up a €10bn loan agreement with Russia, signed on Tuesday, to finance two new nuclear reactors, scheduled for completion as early as 2023.
Hungary is about to seal “the best deal for the past 40 years,” with nuclear power the cheapest option for the country, Janos Lazar, Orban’s right hand man in charge of the prime minister’s office told the media on Thursday. Continue reading »
A ruling on Monday by the Kuria, Hungary’s supreme court, that foreign-currency loans issued in the past decade by local banks were legal, triggered a jump in shares of OTP, Hungary’s largest bank, on the Budapest Stock Exchange. The stock – often seen as a proxy for the Hungarian economy – gained more than 5 per cent to Ft 4,420 in the early afternoon, before easing back to close at Ft 4,311, up 2.8 per cent.
Foreign-currency loans, predominantly in Swiss francs, became hugely popular in Hungary between 2001 and 2008 as borrowers rushed to take advantage of much lower interest rates than those on loans taken out in forint, the local currency. Continue reading »
Mol, the Hungarian oil and gas group, has acquired stakes in 14 oil exploration and production units in the North Sea for $375m from Wintershall, a member of the German BASF Group, Mol said on Friday.
The deal, Mol’s first foray into off-shore operations, gives the Budapest-based group a foothold in the well-established region to the north and east of the Scottish coast, with a mix of some wells that are currently producing oil and others of significant future potential. Continue reading »
With a restrained grin, Mihaly Varga, Hungary’s economy minister, pressed the button to open trading at the Budapest Stock Exchange (BSE) on Friday – simultaneously inaugurating the Xetra trading system for the first time in the Hungarian capital. Continue reading »
Hungary has been pumping out the positive spin on economic news for over a year now.
Back then it was surely premature, but with inflation and the base rate at record lows and economic growth finally appearing – some independent analysts forecasting around 1 per cent expansion this year – there is some evidence to support claims of success.
So Tuesday’s news from Transparency International (TI) that Hungary’s ranking in its annual Corruptions Perceptions Index (CPI) is virtually unchanged from last year would appear, if not good news, at least to avoid any further bad headlines about sliding down a slippery slope. After all, the country dropped just one place, to 47 out of 177 countries examined, with 54 points on a scale of 100, also just one less than 2012.
Not so fast, warns Jozsef Peter Martin, TI executive director in Budapest. Continue reading »