Hungary aims to diversify its investor base for its sovereign debt, opening up to new markets such as Russia, China and Arabian countries, besides retaining its traditional investors such as Europe, the United States and Japan, Chief Executive of Hungary's debt management agency ÁKK told Dow Jones Newswires.
However, the timing of foreign currency issuance is yet unknown.
"We don't know which currency and which market we'll target next time. We're closely monitoring markets, the currencies, yields, risk appetite and investors' readiness to invest in emerging markets and Hungarian debt. When we feel the situation is optimal, we come up with the issue," Gyula Pleschinger said.
Regarding possible bond buys by Russia, the CEO said that could serve as added-value to general economic cooperation, in line with the Hungarian government's strategy to develop relationship between the two countries.
Saudi Arabia can't be closed out as future indirect buyers of Hungary's debt. "Directly I don't think they'd be interested in subscribing for Hungarian bond issues. (However,) at some stage they may wish to increase their emerging market exposure," the CEO said.
Hungary's financing is already covered for this year after successful dollar- and euro denominated bond auctions in spring.
The government bond issuance next year will likely cover only expiring debt, the CEO said.
Hungary's forint-denominated expiring debt will total almost HUF 900 billion ($4.26 billion) next year, while foreign currency-based expiring debt is a little more than €4.5 billion, Pleschinger said.
"This is a guess; it's possible that more items are coming in as the 2012 budget is in the make. We'll detail next year's issuance in November or early December," the CEO added.
Pleschinger also said that a downgrade of Hungary's sovereign debt is unlikely.
"Looking at the fundamentals, I don't see any reason for a downgrade. If I had to, I'd rather bet for canceling the negative outlook," the CEO of ÁKK said.
Rating agencies "really try to understand the landscape", and "will have a close look on figures and outlook, and also take into consideration the government's commitment," Pleschinger added.