Page 68 - CE Outlook Regions 2023

The net financing requirement of the budget is set to reach HUF3.2
trillion in 2023, according to AKK's financing plan released on
December 20. The AKK targets net issuance targets of HUF3.4 trillion
and plans to issue $4bn in H1, as well as buybacks of $1bn of FX
bonds maturing in 2023-2024.

A benchmark-sized eurobond issue is also planned for H2 2023. The
debt manager will set an upper threshold for the ratio of FX debt at 30%
in 2023, compared to a 10-25% range at present. The ratio is down
from over 50% in 2010 as the government prioritised retail financing in
debt management.

The Monetary Council reviewed the central bank's latest quarterly
Inflation Report on December 20 and published the main forecasts. The
report puts average annual inflation at 14.5-14.7% for 2022 and at
15.0-19.5%c for 2023. It forecasts GDP growth of 0.5-1.5% for next
year.

5.4 Markets - Latvia

Strengthening the capital markets in the region in 2023 remains a
priority for the local central banks which have spoken in 2022 of
integrating the three national markets into a pan-Baltic capital market,
to attract investors and give rise to a larger pool of liquidity.

68 CE Outlook 2023 www.intellinews.com