Orban to raise budget deficit due to election spending

Hungary has raised its forecast for the budget deficit to 5% of GDP in 2025 from the previous 4.1%, and the main burden of financing will fall on the banking sector due to the doubling of a special levy. This was reported by Bloomberg.

The Hungarian forint and stocks fell after the announcement of new budget plans. The Economy Ministry said that the deficit will remain at 5% of GDP in 2026, if the government approves the final version of the plan.

Prime Minister Viktor Orbán's election expenses are forcing the government to look for additional sources of funding. The ministry plans to collect HUF 370 billion ($1.1 billion) from the bank levy in 2026 – twice as much as previously estimated.

Shares of OTP Bank Nyrt., Hungary's largest lender, fell by 2.5% after the news. In addition, the government plans to place foreign currency bonds in early 2026.

Orban, who is lagging in polls ahead of parliamentary elections in April, said last week that U.S. President Donald Trump had agreed to help protect the Hungarian economy from possible attacks on the currency or a credit rating downgrade.

• In April 2026, Hungary will hold parliamentary elections. Viktor Orbán's opponent Péter Magyar has a better chance of winning and becoming Prime Minister of Hungary.
• On September 21, tens of thousands of people protested in Budapest, accusing Prime Minister Viktor Orbán of spending taxpayer money on manipulative campaigns.