It seems crisis in Europe spreads East Europe including Hungary, Czech Republic. A concern that the crisis of 2008, illiquidity and export slump, could face once again become higher than before. As proofs of this prediction, Hungary currency, Forint and Czech Republic currency, Czech koruna have gone down for recent one month. Forint dropped 9 percentages, and Czech koruna fell 6 percentages as well as Poland currency in the foreign exchange market. This is because a risk of defaults on the money some West Europe Government like Greece borrowed cause credit crunch of that countries. The chief of IMF warned East Europe about credit crunch as the financial sector of West Europe recalls its money. Moreover, banks of West Europe is supposed to reduce their balance sheet due to lifting of capital ratio (5% -> 9%) I talked before that will make some bad effect to East Europe. Hungary required some help to the IMF even though it wanted FLC (forward looking criteria) as an insurance-type agreement. It is truth that it looks harsh for East Europe to go through the crisis. Hopefully, everything will be fine.

Chief of the IMF’s warning

Hungary and IMF