Hungarian research company raises GDP growth forecast to 4.7 %

Economic research company Pénzügykutató raised its projection for Hungary’s GDP growth this year to 4.7 percent in a forecast released on Wednesday.

The projection was raised from 3.7 percent in a forecast published in March. Research consultant Éva Várhegyi said economic growth could slow to 3.8 percent in 2020 as investments and consumption are expected to grow at a slower pace than this year.

Negative global economic effects will be counterbalanced by development funding from the European Union and measures by the government and the central bank to boost growth, she added. Pénzügykutató sees inflation reaching 3.4 percent in 2019 then falling to 3.2 percent in 2020. Unemployment could edge down a little to around 3 percent while real earnings could grow by 7 percent this year and by 6 percent next year.

The budget deficit may amount to 1.7 percent of GDP this year and fall to 0.9 percent in 2020 according to ESA methodology. Government debt-to-GDP ratio should fall to 67.8 percent by the end of the year and drop to 64.5 percent by the end of 2020. The official government forecasts for GDP growth are 4.0 percent for 2019, 4.0 percent for 2020 and 4.1 percent in 2021 based on the April update of the government’s Convergence Programme.

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