A $25.1 billion financial support package for Hungary from the IMF, the European Union and the World Bank is much bigger than expected and should have a positive effect on the market, analysts told MTI on Wednesday, after the details of the package were announced.
BUDA-CASH brokerage analyst Péter Fazekas said the package should make Hungarian financial instruments -- such as the forint, shares and government securities -- attractive to foreign investors again. Already, the effect of the package can be seen in the firming forint and rising share prices, he added.
MKB Bank chief analyst Zsolt Kondrat said the package is certainly big enough to eliminate any fears of the state going bust. The package will bolster Hungary’s economy, but the pickup will not be sustained unless the situation on global markets improves, he added.
The support package will boost confidence in Hungary, as will the government’s plans to reduce state expenditures in a program related to the package, said ING Bank’s Dávid Németh. It should raise demand for government securities, he added.
The benchmark stock index soared the most in 10 years and the forint rose to a two-week high against the euro Wednesday. The BUX index gained 10% to 12,959.4 at 10:12 a.m. The forint rose 1.4% to 256.71 per euro from 260.45 late Tuesday. (MTI-Eco, Bg)