Hungary: Junk,
junk, junk
Following
the lead of Moody’s and Standard & Poor’s, Fitch has this week become the
third ratings agency to cut Hungary's credit rating to junk status, BB+. The
downgrade comes following widespread accusations that the Hungarian government is undermining
the central bank's autonomy.
A
standby facility with the IMF was recently sought by the Hungarian government,
but talks broke down over a new law that will increase the government's control
of the central bank's governing board.
The country is plagued by the large amount of foreign-currency
mortgages, particularly those denominated in Swiss francs, that were taken out by
home-buyers over recent years. Hungarians that were initially attracted by the
cheap interest rates, now face unfeasible debt repayments as the Hungarian
forint loses value.
Austria: Snowed in
Nearly
2,000 homes have been without power, and on Friday, around 15,000 tourists and
locals were snowed in at ski resorts on the Arlberg mountain. More heavy snow
is predicted over the next few days.
Greece: Euro-exit
becomes more likely
Greece’s
government has this week warned that the country may have to exit the euro zone
if it fails to secure its second EU-IMF bail-out. The announcement came amid new
protests led by doctors and pharmacists against planned spending cuts, with
hospitals taking emergency cases only until Thursday.
The
latest €130 billion bail-out for Greece was agreed by EU leaders in October, on
the proviso that Athens makes further public spending cuts, takes tough action
against tax evasion, and privatises some services and state-owned companies.
Although
the Greek parliament has already adopted a series of austerity measures, evaluation by the EU, the IMF, and the ECB due later this month is likely to
demand more.
By Sonia
Jordan
