Hungary default insurance costs retreat after reaching record highs
Default insurance costs on Hungary’s sovereign debt retreated on Friday after reaching record highs in the previous days.
According to CMA DataVision, a major CDS market data monitor in London, Hungary’s five-year credit default swaps (CDS) traded a little over 690bp early Friday, falling from 735bp after the market’s close on Thursday.
A CDS contract valued at 690bp means that the cost to insure every €10m worth of bond exposure against default is €690,000 a year for the benchmark five-year horizon.
City analysts said market concerns about a possible Hungarian default were "exaggerated".
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