BRUSSELS, October 13, 2008 (AFP) – The European Union and IMF stand read to help Hungary’s government with financial support if needed after its currency, the forint, slumped last week, the EU said.
After the forint took a recent beating amid global financial market turmoil, International Monetary Fund had offered Hungary “technical and financial assistance,” the EU said in a statement.
“We are committed to use all available instruments with a view to supporting Hungary in steering its economy through these difficult times and to withstand the market pressures,” it said in a statement.
“In particular, the EU stands ready to use all tools available in accordance with the (EU) Treaty to complement possible IMF financial assistance,” it added.
Analysts said Hungary’s currency had fallen because investors had panicked and moved their capital out of the country.
With a massive deficit on the flow of all current payments into and out of the country, known as the balance of payments on current account, the financial crisis has hit Hungary hard owing to its dependence on foreign funds to finance the economy.
Overnight from Thursday to Friday, the currency fell by 10 percent bef