Hungary is downgraded to junk by Fitch
Published 07/01/2012 | 05:00
FITCH downgraded Hungary's credit rating to junk status yesterday, citing a stand-off between the government and international lenders like the IMF and the European Union over possible rescue loans.
Fitch kept a negative outlook on Hungary, indicating a more than a 50pc chance for another downgrade on the Central European nation of 10 million people within the next two years. The move followed similar action from Moody's and Standard & Poor's.
Hungary's shaky finances have been battered this entire week. Its currency, the forint, fell to all-time lows during two consecutive days and the government suffered through a rough bond auction on Thursday in which the interest rates it had to pay to borrow jumped more than two percentage points in just a few weeks.
Investors are deeply unsure about the government's economic policies and whether it can agree upon a rescue loan with the IMF. (AP)