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Hungary borrows 6.5% of GDP in 4Qs

Hungary's net foreign borrowing was HUF 2,291 billion, or 8.7% of GDP, in the four quarters to the end of Q3 2008 including net borrowing of HUF 633 billion, the equivalent of 9.4 of quarterly GDP in Q3, the Hungarian Central Bank’s (MNB) financial account report revealed on Monday.

Four quarter external net borrowing was the highest since the end of 2006 in terms of GDP and rose from 5.2% in Q2 2008 and 3.2% in Q3 2007, MNB figures show.

Third quarter net foreign borrowing rose from HUF 507 billion in Q2 lat year, but it was down from HUF 710 billion in Q1 2008, when it reached 9.4% of the quarterly GDP.

Third quarter net foreign borrowing stemmed from HUF 970 billion in gross borrowing and HUF 337 billion in gross lending. Long-term loans accounted for HUF 699 billion of gross borrowing, while investment in listed shares made up a further HUF 110 billion. Foreigners’ holdings of other securities than shares decreased by HUF 203 billion, while fresh equity investments were worth HUF 264 billion in the third quarter last year. Hungary's foreign investments in securities other than shares declined by HUF 814 billion in Q3 last year, while quarterly investments in shares and equities was worth HUF 224 billion. There was a total of HUF 715 billion in new foreign deposits and HUF 114 billion in loans in Q3. (MTI – Econews)