GKI expects Hungary’s GDP growth to slow to 2.0% next year from an expected 2.7% in 2015, the economic research institute said in its latest quarterly forecast. Growth is set to decelerate on a temporary fall in European Union funding, a slower rise in domestic consumption and falling demand for exports, GKI chairman András Vértes said at the fresh forecast’s release on Monday.
GKI expects household consumption to rise just 1.5% next year, after climbing an expected 2.5% in 2015. It sees investments dropping 5% after stagnating this year. GKI projects the general government deficit will reach 2.6% of GDP this year and 2.3% next year, over the respective 2.4% and 2.0% government targets. It explained that the overshoots would depend on government measures to reduce state debt in an effort to avoid an excessive deficit procedure.
Last week both Hungary’s central bank (MNB) and economic research institute Századvég lowered its Hungarian GDP growth forecast for 2015. While MNB forecasts a growth of 3,2% for this year and 2,5% in 2015, Századvég expects Hungary’s economic growth to reach 3,1% in 2015, slowing down to 2,5% in 2016.
source: gki.hu and hungarymatters.hu