Fitch says Hungary’s fiscal plans support 2030 euro criteria goal
The agency forecasts a larger deficit than the government in 2027 and warns that implementing the planned fiscal tightening will be challenging.
Hungary’s proposed fiscal tightening supports its ambition to satisfy euro adoption requirements by 2030, Fitch Ratings said. But the agency warned that delivering the budget measures would be difficult and that success on public finances alone would not establish eligibility.
Under the 2027 budget proposal presented by Prime Minister Péter Magyar, the deficit would fall to 4.9 per cent of GDP, against an expected 7.5 per cent in 2026. The government’s subsequent targets are 4 per cent for 2028, 3.4 per cent for 2029 and 2.8 per cent for 2030.
For 2027, ministers propose expenditure reductions equivalent to 1.5 per cent of GDP and additional revenue of about 1 per cent of GDP. The cuts cover areas including public media, government communications and state investment. Operating budgets at ministries and state-owned companies would be reduced by at least 10 per cent.
Fitch cautioned that the strategy depends on many smaller measures and sustained budget discipline. Some projected savings are uncertain, while fresh spending pledges and tax relief amounting to about 1.4 per cent of GDP would absorb part of the benefit.
The agency’s forecasts put the deficit at 7.3 per cent of GDP in 2026 and 5.4 per cent in 2027, before it falls below 3 per cent by 2030. Fitch projects that public debt will reach its highest level, 77.7 per cent of GDP, in 2027–2028.
Euro adoption also depends on inflation, long-term borrowing rates, currency stability and domestic legislation. Before joining, a country must complete at least two years in the ERM II exchange-rate mechanism without serious currency tensions or a devaluation of its central exchange rate against the euro.
