Talk of Hungary default "wildly exaggerated" – EU

BUSAN, South Korea, June 5 (BestGrowthStock) – The European Union’s
top economy official on Saturday dismissed talk that Hungary was
about to tumble into default, saying its economy was on the way
to recovery.

Fear of a Hungarian debt crisis pushed the euro to a
four-year low on Friday after a government spokesman said the
country had only a slight chance of avoiding the same fate as
Greece is facing.

“Hungary has made serious progress in consolidating its
public finances over the last couple of years,” EU Economic and
Monetary Affairs Commissioner Olli Rehn told reporters in the
South Korean port city of Busan.

He was speaking at the end of a two-day meeting of finance
ministers of the Group of 20 leading developed and emerging
economies, dominated by concerns over the increasingly troubled
euro zone.

“Now the Hungarian economy is on the way to recovery and has
shown the first signs of strength in the first quarter of this
year. Therefore, any talk of a fiscal or debt default in Hungary
is widely exaggerated,” Rehn said.

A run on its currency after the 2008 global financial crisis
forced Hungary to turn to the EU and the International Monetary
Fund for a $25 billion rescue package.

Spain’s Economy Minister Elena Salgado, also attending the
G20 meeting, said an EU-IMF mission would have to decide whether
the concerns were correct and to what extent the fiscal deficit
might rise. But she made no mention of whether such a mission was
imminent.

“Nevertherless, the Hungarian government has taken very brave
measures to reduce the fiscal deficit and I think they are going
to continue doing that,” she said. Spain currently holds the
rotating presidency of the EU.

The new Hungarian government blames its socialist predecessor
for the country’s current plight.

Hungarian State Secretary Mihaly Varga, speaking in Budapest,
said later that the government aimed to meet its deficit target
despite the current difficulties. [ID:nTST002024]

The government plans to hold informal talks with the IMF, he
said. [ID:nTST002025].

Stock Market Report

(Reporting by Sohpie Taylor and Jonathan Gordon; Writing by
Jonathan Thatcher; Editing by Tomasz Janowski)

Talk of Hungary default “wildly exaggerated” – EU