Political earthquake in America, what are the markets pricing in? – We asked the CEO of the ÁKK.

Gergely Tardos, CEO of the Debt Management Agency, commented that the results of the U.S. midterm elections could lead to lower Hungarian yields. He noted that the current yield on 10-year Hungarian bonds, around 5.5%, may approach or drop below 5% due to positive market reactions to budget plans. Looking ahead, he suggested that Hungary could reach yields near 4% with favorable conditions, aligning with other eurozone countries. The Debt Management Agency plans to reduce bond issuance next year due to decreased financing needs, although it will still need to refinance maturing bonds. New climate-focused bonds may also be introduced. Tardos believes that income redistribution within the budget will not significantly impact demand for retail government bonds in the coming year, and he emphasized the need for a stronger exchange rate for eurozone entry.