Hungary’s credit default swaps (CDS) dropped to 254 basis points at the end of Q1 2011. In the previous edition of CMA Datavision Global Sovereign Credit Risk Report’s Hungary was among the top 10 riskiest countries. But, according to their recent report published on April 6, Hungary made a spectacular improvement of 124bps during the first three months of 2011.

 

Beside some positive international trends, the ease of CDS is due to the announcement of the Hungarian government’s Széll Kálmán Plan in the beginning of March that plans to reduce Hungary's national debt from its current level of more than 80% of GDP to 65-70% of GDP by 2014. The decreasing perceived risks of the Hungarian economy helps the government to sell USD bonds.