Hungarian Prime Minister Viktor Orbán is returning to the familiar playbook of loosening fiscal policy ahead of the election in April. Any signs that a widening in the budget deficit will be sustained after the election could result in an increase in risk premia on local assets. Meanwhile, the Greenland crisis this week will likely leave European governments even more inclined to raise defence spending, which could provide a boost GDP in the region. Finally, with Bulgaria heading for its eighth election in four years, political instability will continue to drag on the pace of income convergence.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services