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Gross general government debt 76.9% of GDP in Q2

Hungary's consolidated gross general government debt was 76.9% of GDP, or HUF 19,967 billion (€73.85 billion), at the end of the second quarter, according to preliminary data published by the National Bank of Hungary (MNB).

Gross debt of the central government fell from HUF 21,789 billion at the end of Q1, when the forint hit a record-low standing of 11.9% weaker to the euro and 17% weaker to the dollar than at the end of June. Gross debt fell from 82.9% of GDP at the end of Q1, but exceeded the 73% level at the end of last year.

The net central-government debt amounted to HUF 13,641 billion at the end of Q2, which is 54.3% of GDP, up from 51.8% of GDP three months earlier and 49.6% twelve months earlier.

The net financing requirement of the central budget rose to 4.8% of GDP (HUF 308.4 billion) in Q2 from 4.5% (HUF 257.3 billion) in the first quarter. Seasonally adjusted figures also show a 0.3% point increase from 4.9% in January-March to 5.2% in Q2. Hungary's net financing-requirement in the 12-month period concluding at the end of June was 4.7% of GDP, or HUF 1,224 billion (€4.53 billion). All figures in terms of GDP are far from the 3.9% deficit target set by the government for this year.

The net financing need includes HUF 1,671.5 billion in withdrawals from deposits and repayment of HUF 985 billion in long-term debt bonds and HUF 263.9 billion in fresh borrowing.

The net financial savings of households was 2.6% of GDP in the year ending on June 30, according to the preliminary data, though savings in Q2 was just 0.4% of the quarterly GDP (just HUF 25 billion), MNB figures show. Net household savings slowed from 4.5% of GDP in Q1 (HUF 258 billion) and 7.1% (HUF 496 billion) in Q4 2008, though the same period last year showed 0.4% (HUF 45 billion) borrowing in terms of GDP. (MTI – Econews)