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Századvég Raises Hungary GDP Growth Forecasts

MTI-Hungary Today 2019.06.20.

Pro-Fidesz economic research institute Századvég raised its projections for GDP growth in Hungary to 4.3 percent for 2019 and 3.7 percent for 2020 in a fresh forecast released on Wednesday, but did not rule out a 5 percent growth rate for this year.

The projections for 2019 and 2020 were raised from 3.9 percent and 3.5 percent, respectively, in a forecast released by the think-tank in March.

Századvég said the growth rates would be lifted by consumption.

Consumption is seen rising by 4.5 percent in 2019 and by 4.9 percent in 2020 on the back of rising wages.

Századvég put Hungary’s foreign trade volume at 4.1 billion euros for this year and at 4.5 billion euros for 2020.

Inflation is set to reach 3.5 percent in 2019 and 3.2 percent next year.

The unemployment rate is seen declining over the coming 18 months and is expected to fall to 3.4 percent this year and 3.2 percent in 2020, Századvég said.

The average gross wage is set to continue rising by over 10 percent, the think-tank said, putting wage growth for 2019 and 2020 at 10.5 percent and 10.8 percent, respectively.

Századvég said the central bank could raise the key interest rate to 1.35 percent by the end of next year.

Századvég lists the slowdown of the German economy, uncertainty over Brexit, trade wars, the outcome of measures meant to improve competitiveness, changes in global oil prices and the forint’s exchange rate as the biggest risks to Hungary’s economy.