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Hungary’s state debt relative to GDP rose to 80.3% in Q3 from 77.4% in the previous quarter, the National Bank of Hungary (NBH) said in a second reading of data on Friday. The Q3 debt ratio was a fraction under the 80.5% figure in a preliminary reading of the data released on November 17. State debt was lifted by the issue of the equivalent of 4.5 billion euros of FX bonds in September to bridge finance delayed transfers from the European Union’s Recovery and Resilience Facility (RRF), to finance other discretionary expenditures in 2021, and to pre-finance some 2022 budget expenditures. Those issues lifted the share of FX debt within state debt to the equivalent of 18.1% of GDP in Q3, up from 15.1% in Q2. The finance ministry expects state debt to fall to 79.9% of GDP at the end of 2021.
In absolute terms, Hungary’s state debt reached 42,106 billion forints (EUR 113.8bn) at the end of Q3, up from 38,418 billion at the end of 2020. FX debt came to 9,486 billion forints at the end of Q3. The NBH data show the budget’s net financing requirement – a good approximation for the general government deficit – reached 517 billion forints in Q3, equivalent to 3.7% of quarterly GDP. Households had a net financing requirement – for the first time in more than a decade – of 66 billion forints in Q3, equivalent to 0.5% of quarterly GDP.