As the Swiss franc soars...up 16% v the Hungarian forint in just the past month...the threat to Budapest's economy grows...from strapped homeowners.
Because two-thirds of Hungary's mortgages are held in francs...to escape local high interest rates.
“It works like a tightening if the debt burden is too high. It bites Hungary very hard,” observes a Citigroup strategist.
Meanwhile...Hungary’s credit rating may soon be downgraded to junk by Moody’s and Standard/Poor’s.
Both rate it at their lowest investment grade...with a negative outlook.