The Tisza Party's landslide victory in Sunday's election, giving it a two-thirds majority in parliament, should support improved relations with the European Union and ease the risk of institutional clashes that could have undermined its ability to implement policy changes, Fitch said.

"Our sovereign credit analysis will now focus on assessing the credibility and feasibility of the new government's fiscal-consolidation strategy, its implications for public debt and growth," it added, noting that the revision to the outlook for Hungary's 'BBB' rating to negative in December had been underpinned by the impact of pre-election fiscal easing on public finances, rising debt, and an uncertain consolidation path.

Fitch forecasts GDP growth will strengthen to 2pc in 2026 and 2.4pc in 2027, supported first by a pick-up in private consumption owing to pre-election fiscal easing, then a gradual recovery of investment and new export capacities in the automotive and battery sectors. High energy prices due to the conflict in the Middle East are a risk to the forecasts, it added.

The new government's pro-EU stance is likely to support improved cooperation with Brussels and implementation of policy measures that address concerns about rule of law, judiciary independence and corruption, leading to the unblocking of EU funding, Fitch said.

"Nonetheless, it is unclear how quickly a full resumption of fund disbursements would translate into higher growth prospects," it added.

Fitch sees Hungary's general government deficit widening from 4.7pc of GDP in 2025 to 5.6pc in 2026 on pre-election fiscal easing and energy support measures.

"Once it has formulated its medium-term fiscal consolidation strategy, the incoming government will face a challenge to rebuild fiscal policy credibility and strengthen the fiscal framework after frequent revisions of budgetary targets and departures from stated fiscal policy objectives in recent years," the rating agency added.

Source: MTI – Hungary’s national news agency since 1881. While MTI articles are usually factual, some may contain political bias, and readers should be aware that such content does not reflect the position of XpatLoop, which is neutral and independent.

Since the goal of XpatLoop is to keep readers well briefed, right across the spectrum of opinions, MTI items are shared to ensure readers are aware of all narratives within the local media.

XpatLoop believes in empowering readers to form their own views through complete and comprehensive coverage. To facilitate this XpatLoop has a balanced range of news partners, as you can see when you surf around XpatLoop.com

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