UniCredit SpA plans to buy Hungarian foreign-currency bonds after the country covered most of this year’s external funding needs in a record debt sale, and because planned spending cuts may boost its credit ratings, Bloomberg reported.
“We look to re-enter Hungarian external markets as the country tops emerging Europe, Middle East and Africa in year-to-date coverage of external borrowing needs,” Gyula Tóth, Vienna-based chief strategist for emerging EMEA, Middle East and Africa at UniCredit, wrote in a research note.
Hungary hired UniCredit, Deutsche Bank AG and ING Groep NV for meetings with investors before a possible debt sale. “Hungary has surprised us on the upside this year,” Tóth wrote. “Should the government push ahead with its consolidation plans, the sovereign should over the coming quarters see rating agencies shift from their negative outlook and eventually reverse some of the downgrades.”
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