Moody’s Downgrades Budapest to Junk Over Liquidity Concerns

Moody's, a company that rates how likely it is for governments or companies to pay back their debts, has lowered Budapest's rating to 'junk' status.

This means they think it's riskier for Budapest to pay back its debts.

The main reasons are that Budapest doesn't have enough money easily available (weak liquidity) and it's in a fight with the national government over taxes.

The government is making Budapest pay more in taxes, which is called the 'solidarity tax.'

This tax is expected to be a lot of money in 2025, making it hard for Budapest to manage its budget.

Additionally, the European Union has stopped giving Hungary some of its funds because of concerns about democracy, which also affects Budapest's financial situation.

The mayor of Budapest, Gergely Karacsony, blames the government's tax policies for the downgrade.

Despite this, the prime minister, Viktor Orban, has said the government is willing to help Budapest financially.