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Budapest, the historic Hungarian capital on the Danube, is a definite must-see on anyone's European tour. While it's not quite the cheap holiday destination it was before the budget airlines got there, prices here will leave plenty of cash in your pocket. Indulge in luscious cakes, get refreshed on strong liquor and sweat it out in the famous thermal spas. Stop for a sweet treat at Gerbeaud's for gourmet pastries too pretty to eat (almost), or visit a traditional kávéház (coffee house) for a calorific (who's counting?!) slice of _kürtőskalács _or chocolate chimney cake. With sit-down dinners for under Ł5, beers for Ł1 and rooms for Ł10, Budapest is a beautiful bargain. And you can visit those gorgeously ornate bathhouses such as Gellert from Ł14 for the day, with massages starting at less than a tenner. If you're after a quiet countryside retreat, check out Lake Balaton in Transdanubia, western Hungary. The biggest lake in central Europe, it's a popular summer retreat for local families looking to escape the big smoke during the summer heat - it's an easy one and a half hour train ride from Budapest and the biggest resorts are found in the cities of Siófok and Balatonfüred. Take a hike in the northern hills, swim in the lake or sail out on the cool waters, before enjoying some locally produced - and incredibly cheap - wines from the vineyards dotted across nearby Badacsony Hill.