The Hungarian government's net borrowing stood at HUF 271.1bn (EUR 889mn) in the first quarter of 2014 equalling to 4% of the quarterly GDP, according to preliminary financial accounts data, published by the central bank. In cumulative terms, net borrowing amounted to HUF 791.1bn, or 2.7% of the GDP in the four quarters to Q1 2014.

The central government had a net financing requirement of HUF 864.4bn in Q1. On the assets side, deposits with the central bank increased significantly, while its securities holdings and loans dropped. On the liabilities side, there was a large transaction of government securities issues, of which short-term securities were purchased mainly by other monetary financial institutions and long-term government bonds were purchased by non-residents.

The local governments had a positive balance, as net lending stood at HUF 529.1bn. This was due to an increase of the assets in deposits and at the same time a decrease of liabilities in loans and securities, due to debt assumption by the central government.

The social security funds had a net lending of HUF 64.3bn in Q1 2014.

Hungary’s consolidated gross debt at nominal value, or the so-called Maastricht debt, stood at HUF 24,904bn, accounting for 84.6% of the GDP at end-March 2014, up from 79.2% at end-2013. This increase resulted from the large issues on government securities, coupled with depreciation of the forint.