Fitch Ratings changed Hungary’s Long-Term Foreign-Currency Issuer Default Rating (IDR) outlook to ‘negative’ from ‘stable’ on December 5 and affirmed the debt grade at ‘BBB’, keeping the country just one notch above non-investment (“junk”) status. The decision reflects concerns over ballooning deficits, rising debt, and erratic fiscal targets, with economic growth remaining sluggish as the election draws near. Fitch has sharply downgraded its projections for public finances, citing new measures ahead of the 2026 parliamentary elections. The agency also warned that additional populist measures may be introduced in early 2026, further weakening policy predictability and increasing fiscal risks. Analysts project the fiscal deficit will widen from 5% of GDP in 2025 to 5.6% in 2026, significantly above June's projections. Hungary’s government targets a 5% shortfall both this year and next. Fitch sees GDP growing just 0.3% this year, amid tight monetary policy and reduced EU fund inflows.