GKI continues to expect Hungarys economy to contract by 1.5% in 2012.

By bne IntelliNews March 6, 2012
Think-tank GKI has kept unchanged its forecast for Hungary's economy that it expects to contract by 1.5% this year, GKI said in its latest report. The expected recession in Europe will have a negative effect on Hungary's economy, as the exports growth is seen slowing down to 10% y/y from 11.7% in 2011.The country's outlook has further deteriorated after the collapse of flag carrier Malev and on the closure of Nokia's plant. Domestic demand will drop significantly in 2012. Household consumption is projected to fall by 2.5% on the year due a 3.5% decrease in real wages, stagnation of employment and a decrease in social benefits. Investments activity is expected to decline by 4% y/y due to legislative and economic uncertainness. GKI projects consumer prices to grow by 5% y/y on average in 2012, accelerating from 3.9% estimated for 2011. Referring to the fiscal policy, GKI remains pessimistic that government will manage to keep the budget deficit below 2.5% of GDP in 2012 and it sees the gap at 2.9%. Fiscal consolidation requires adjustments totalling between HUF200bn and HUF300bn in 2012. GKI said that the delay in the start of financial aid talks with the IMF and the EU would cause another shock in the country's financial assessment.

Related Articles

Assets of Hungarys investment funds up 3.2% m/m in Feb 2013.

Hungary's investment funds had aggregate assets of HUF 3.657tn (EUR 11.98bn) as of end-February 2013, up by 3.2% m/m, MTI news agency reported citing data from the association of investment funds ... more

Hungary's number of employees down 0.6% y/y in Jan 2013.

The number of employees in Hungary's public and private sectors fell for the tenth straight month in January 2013 declining by 0.6% y/y to 2.574mn, the statistics office informed. The decline ... more

Hungarys MVM clears deal for purchasing E.ONs local units.

The assembly of state-owned Hungarian Electricity Works (MVM) has approved the purchase of the local gas business of German power utility E.ON, Hungary AM reported, citing local daily Magyar ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss