By: The Quinnipiac University Economics Research Team, Jack Hangen
Dramatically rising energy prices are causing concern across Europe. In addition to adding sudden relative price spikes to the complicated landscape of businesses, the Hungarian government has said it’s also concerned because of its effect on inflation. The government is now exploring a range of options in an effort to curb inflation. Some of the latest policy tools being considered (and in some cases already implemented) are interest rate freezes, credit moratoriums, and food price freezes. The hope is that these measures help in the short run while inflation more broadly slows over 2022.
To help its population cope with rising prices, the government is also working on providing additional tax benefits for people throughout the nation. As an example, the government plans to give people under 25 a tax break this year so they will not have to pay personal income tax. This move alone is expected to give young people an extra HUF 40,000 per month on average. The government is also working so that policy changes will be felt by all social and economic classes. While the Hungarian government continues to implement policies, inflation continues to rise both domestically and across Europe.
This article is based upon: https://hungarianinsider.com/economic-growth-could-be-more-than-6-percent-in-2021-9405/