June 20, 2018 / 11:50 AM / a month ago

UPDATE 1-Hungary has no near-term plans to issue eurobonds - debt office

* No plan to issue eurobonds despite domestic yield spike

* Budapest just over halfway through its issuance plans for the year (Adds comments on forint debt issuance, rise in Hungarian yields)

LONDON, June 20 (Reuters) - Hungary has no near-term plans to issue eurobonds, the deputy head of the country’s debt office said on Wednesday.

Hungary has issued hardly any foreign currency debt in recent years to reduce its exposure to investor mood changes, but a spike in domestic borrowing costs this year has raised questions whether eurobonds could work out cheaper.

Eurobonds are government bonds issued in major foreign currencies like the dollar, euro or yen.

“In the coming years our foreign currency debt will remain relatively low, so we are seeing market possibilities but in the near future there is no plan for similar transactions,” Andras Rez said at Euromoney’s annual global bond investors forum.

He added that the current drop in activity in forint debt markets, which has compounded the rise in bond yields, was expected to be temporary and afterwards told Reuters it was too early to think about any change to borrowing plans.

Rez also said the debt office was just over halfway through its bond issuance for the year. It has boosted sales since the government in Budapest signalled it would spend more than planned prefinancing EU-funded projects. (Reporting by Marc Jones Editing by Abhinav Ramnarayan and Raissa Kasolowsky)

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