Hungary’s GDP growth has been low in 2016 compared to other countries in the CEE region or to its growth rate in the previous year. However, some acceleration of the growth rate can be expected in the second half of the year. GKI maintains its GDP growth forecast of 2 per cent for 2016. Internal and external equilibria are very favourable, and inflation almost ceased.
By the end of summer 2015 statistical data also revealed that the Hungarian economy has been on a slowing trajectory. It is no surprise as the rapid growth in 2014 (that also continued in the first quarter of 2015) was basically due to temporary factors, such as the peak of the inflow of EU transfers, the revitalization of consumption in connection with the election year, the excellent harvest and former automotive investments. Economic prospects are further dimmed by a slowdown in the Chinese economy and the expected deterioration in European business activity, due to rising political risks (e.g., migration crisis). Read More …
In 2014, the performance of the Hungarian economy was much better than anticipated by anyone. Nevertheless, in a forward looking perspective, it did not reach a trajectory that ensures sound caching-up by Central and Eastern European standards. The spectacularly favourable statistical figures of 2014 are attributed to temporary factors and/or unduly heavy sacrifices made in other fields.
After a recession of about 1.5 per cent in 2012, no growth can be expected in Hungary in 2013 either. Inflation will slow down significantly. The main purpose of the government, that is, avoiding the excessive deficit procedure, is getting more and more at odds with the launch of an economic policy favouring the forthcoming elections.
The 2012 forecast of GKI proved to be almost completely accurate: GDP fell by 1.7 per cent in Hungary. Only stagnation can be expected this year, and the lagging behind of the Hungarian economy in the region continues. Inflation will slow down significantly.