The cost of insuring Hungarian state debt fell on markets in London on Thursday, after European Union leaders agreed on a deal to manage the sovereign debt crisis in the eurozone.
CMA DataVision said that the benchmark 5-year mid-spread of Hungary’s credit default swaps contracts (CDS) was around 482bp in trade in London late on Thursday, down from 526.5bp late Wednesday.
Hungary’s CDS mid-spread was around 460bp at the beginning of September and around 255bp at the beginning of the summer.
A CDS contract valued at 482bp means that the cost to insure every €10m worth of bond exposure against default is €482,000 a year for the benchmark five-year horizon.
Hungary’s CDS mid-spread peaked at 630bp in March 2009.
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