BCA Research is advising investors to go long HUF/USD following a surge in Hungarian assets and the currency since last weekend's general election, the firm said. The recommendation reflects BCA's view that Hungary stands to benefit from a renewed flow of European Union funding and a materially lower country risk premium.
According to BCA, Hungary has recorded the weakest growth among the three central European countries over the past couple of years, but that trajectory should change if EU relations improve. The research house expects a new government to mend frayed relations with the EU - a shift that could release funds previously frozen because of disputes over euroskeptic policies and rule-of-law concerns.
BCA estimates Hungary could receive as much as 26 billion euros in additional grants and loans from Cohesion Funds and the Recovery and Resilience Facility over the next couple of years. For context, net capital and financial account inflows to Hungary totaled 5 billion euros in 2025, the firm noted.
The additional EU funding cited by BCA would equate to roughly 12% of Hungary's 2025 GDP, a proportion the research house says is well above that of other central and eastern European peers. BCA also highlighted a possible further 16.2 billion euros in support under the Security Action for Europe framework.
On the basis of these potential inflows and the prospect of a lower country risk premium, BCA has instructed clients to take a long position in HUF/USD. The recommendation is framed around the idea that resumed EU financing and reduced perceived sovereign risk would provide a substantive boost to Hungary's external financing and growth outlook.
Analysis summary
- BCA Research recommends going long the Hungarian forint against the U.S. dollar after a post-election rally in Hungarian assets.
- The firm expects the new government to repair relations with the EU, potentially unfreezing previously withheld funds.
- Estimated additional funding includes up to 26 billion euros from Cohesion Funds and the Recovery and Resilience Facility and a possible 16.2 billion euros via the Security Action for Europe framework; net capital and financial account inflows were 5 billion euros in 2025.
Implication
BCA's guidance is that these potential funding flows and a reduced country risk premium would support the forint and change Hungary's recent relative growth performance among central European peers.