The latest growth forecasts out of the Hungarian National Bank (MNB) indicate an increase in GDP for 2025 of just 3 percent, while its inflation estimate was raised.
After Q3 GDP data saw the Hungarian economy back in a recession, MNB now expects 2024 growth to come in at 0.3-0.7 percent, down from its previous forecast of 1.0-1.8 percent, reports Portfolio.hu
Just six months ago, the portal points out, central bank experts expected this year’s economic expansion to be 2-3 percent.
As for 2025 GDP growth, the bank had previously called for a range of 2.7-3.7 percent, down from earlier estimates of 3.4-4.5 percent, and now, analysts have slightly lowered their estimates yet again to 2.6-3.6 percent. (The official government forecast is for growth of 3.4 percent.) MNB says a strong recovery could occur in the second half of 2025.
Meanwhile, inflation is expected to increase to 3.3-4.1 percent next year, up from September’s forecast of 2.7-3.6 percent. Central Bank Governor Barnabás Virág said during a press conference that higher inflation is expected due to the weaker forint and the newly announced government tax measures.
Just last Friday, construction data reported for October finally increased by 4.6 percent versus September; unfortunately, this was only slightly more than the decrease reported last month and not much consolation after the downward trend seen since May. The increase was also reported for the category of “other buildings,” Portfolio reports, which typically means state infrastructure developments.
However, combined with upswings in manufacturing and retail trade, chances are increasing that Hungary will exit its recession by the end of 2024.
