The Hungarian Socialist government has introduced a series of tough austerity measures aimed at shoring up international confidence in this Eastern European country’s economy, and the first signs seem to indicate that these reforms are having their intended effect.

The Hungarian forint continues its impressive rise, from a low of 282 to the euro late last week, to 262 earlier today.

While the government’s reforms are likely to be unpopular with voters, it will help stabilize the country’s economy during a global financial crisis, and will also allow Hungary to receive over $10 billion in financial assistance from the International Monetary Fund.

At the core of these new measures is a plan to freeze all wage increases for Hungary’s sizeable civil service, as well as cut back on an annual extra income scheme provided to all pensioners in Hungary.

Soon after Prime Minister Ferenc Gyurcsany’s centre-left  minority government announced these plans, the value of the Hungarian forint began to rise.

Additionally, with these measures the Hungarian government will be able to further decrease its deficit to around 2.6 percent of the GDP. Originally, government officials had expected the deficit to stand at around 3 percent.

This represents a major improvement from recent years, as only two years ago the deficit amounted to over 9 percent of the GDP.

If the newest projection proves to be accurate, Hungary will have fulfilled the most important requirements necessary to adopt the euro by next year. As such, the country will be on course to adopt the European common currency by 2012.