Hungary starting bailout talks in attempt to soothe market worry

TALKS between Hungary and the International Monetary Fund (IMF) began in Washington yesterday, according to Hungary’s economy ministry.

The country hopes that a credit line from the IMF will not need to be called upon but will be seen by investors as a safety net preventing the country from defaulting on its debts.

Yields on the government’s 10-year debt spiked to 9.5 per cent in December and 10.8 per cent last week as concern grew over the new constitution put in place over the New Year.

Prime Minister Viktor Orban fell out with international lenders over the changes, but now must court them after investors panicked.

Following this week’s negotiations, the country will also discuss aid with the EU.