MW: Fitch: IMF deal for Hungary would be positive step
By William L. Watts
FRANKFURT (MarketWatch) -- A potential agreement on a new International Monetary Fund program to support Hungary would be a "positive step" and could reduce downward pressure on the country's BBB-minus credit rating, Fitch Ratings said Friday, but warned that "significant downside risks" would remain. Fitch revised Hungary's outlook to negative from stable earlier this month, citing the country's exposure to the euro-zone debt crisis and the government's decision to allow mortgage holders to repay foreign-currency mortgages at below-market exchange rates. News reports said Hungary has started talks with the IMF and European Union on securing aid. "Even if a deal were agreed, the potential for reform fatigue, a track record of unpredictable policy making and a desire for asserting national independence could make it challenging to stick to an IMF program," Fitch said.
