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Public finances now a growing concern in parts of CEE

The larger-than-expected 2023 budget deficit figures released across parts of Central Europe this week underline our concerns about the fiscal challenges facing the region. The need for fiscal tightening is growing, particularly in Hungary, as the large budget deficit will make it harder to put the public debt ratio on a sustainable footing. Any fiscal slippage in the coming years could add to risk premia on sovereign debt.

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