(Financial Times, Joseph Cotterill and Ian Smith, April 21, 2026)
Investors are pouring into Hungarian assets, betting that Viktor Orbán’s electoral defeat and Péter Magyar’s overwhelming victory will pave the way for closer relations with the European Union, resulting in economic benefits and lower financing costs. The Budapest stock exchange has risen nearly 15% this month, the forint has gained 3.6% against the euro, and the country’s borrowing costs have plummeted by more than 1.2 percentage points. About half of the gains came before last weekend’s elections, when polls indicated a clear win for the opposition leader. Magyar’s Tisza party supermajority allows him to amend all laws, including the Constitution, opening the door to profound reforms.
The “return of credible economic policy” and rapprochement with Brussels could save Hungary’s credit rating from a downgrade to “junk,” according to Viktor Szabo of Aberdeen, who bought Hungarian debt before the vote. Investors are now focusing on how the new government intends to achieve the ambitious goal of joining the euro by the early 2030s, despite the economy still being far from the Maastricht criteria. Magyar will also have to dismantle Orbán’s “illiberal democracy” and unlock billions of frozen EU funds. So far, the market believes in his ability to succeed: OTP Bank’s stock, the benchmark of the index, rose 8% after the elections and 26% for the month, nearly doubling over the past year.
The rally reflects general optimism about structural changes, the pro-EU shift, and access to substantial European funds. Investors hope post-Orbán Hungary will narrow the economic gap with countries like Poland and implement the fiscal reforms necessary for the euro, beneficial even if the forint remains in place. Hungarian debt yields have already approached Polish levels. According to Citi economists, the greatest upside potential lies not so much in euro adoption but in the convergence process: the measures required to meet the Maastricht criteria – controlling inflation, reducing deficit and public debt – are exactly what the Hungarian economy needs. In the short term, Magyar will have to manage forint volatility, cut social spending inherited from Fidesz, and tackle the patronage networks left by Orbán, while unlocking about 12 billion euros of EU funds in the coming months.
Investors Bet on EU Rapprochement After Orbán’s Defeat.
“Investors are pouring into Hungarian assets, betting that Viktor Orbán’s defeat and Péter Magyar’s landslide victory will pave the way for closer ties with the EU, benefiting the economy and reducing financing costs. The Budapest stock exchange has risen nearly 15% this month, the forint has gained 3.6% against the euro, and borrowing costs have collapsed by more than 1.2 percentage points.”
Magyar’s supermajority opens the door to radical reforms.
“Magyar’s Tisza party has secured a supermajority that allows it to change all laws, including the Constitution. The ‘return of credible economic policy’ and rapprochement with Brussels could save Hungary’s credit rating from a downgrade to ‘junk.’ Investors are now focusing on the plan to join the euro by the early 2030s.”
The Rally Reflects Optimism on EU Funds and Reforms.
“The rally reflects general positivity about structural changes, the pro-EU shift, and access to substantial European funds. Investors hope post-Orbán Hungary will narrow the economic gap with Poland and implement the fiscal reforms necessary for the euro. Hungarian debt yields have already approached Polish levels.”
The Benefits of the Convergence Process Towards the Euro.
“According to Citi economists, the greatest upside potential lies not so much in adopting the euro but in the preparation process: the measures required to meet the Maastricht criteria – controlling inflation, reducing deficit and debt – are exactly what the Hungarian economy needs.”
The Challenges Facing the New Government.
“Magyar will have to dismantle Orbán’s ‘illiberal democracy,’ unlock billions of frozen EU funds (up to about 12 billion in the coming months), and manage forint volatility. He will also need to cut social spending inherited from Fidesz and confront the patronage networks left by the old regime, in a still complex political context.”
(Excerpt from the newsletter by Giuseppe Liturri)
