IMF improves Hungary’s 2013 GDP projection to 0.2%.

By bne IntelliNews October 9, 2013

Hungarian economy is expected to grow by a real 0.2% y/y in 2013 after contracting 1.7% y/y in 2012, the IMF said in the October 2013 edition of its World Economic Outlook. The GDP will expand by 1.3% y/y in 2014. In the April edition of the report, the IMF was expecting stagnation in 2013 and a 1.2% y/y increase in 2014.

After sharp deceleration of the annual inflation to 2.3% in 2013 from 5.7% in 2012, consumer prices will again speed up 3% in 2013, the fund said.

Hungary’s current account surplus is projected to expand to 2.2% of GDP in 2013 from 1.7% last year and to narrow again to 2% in 2014.

The IMF expects the unemployment rate to increase from 10.9% in 2012 to 11.3% in 2013 and edge down to 11.1% the next year.

Although, the country's fiscal position is forecast to deteriorate in the next two years, posting deficits of 2.7% and 2.8% of GDP, respectively, it will still be in line with government’s plan to keep the gap below the EU's limit of 3%.

In regional comparison, Hungary’s GDP will perform weaker than all European emerging economies (Croatia is a single exception in 2013), which are projected to grow by an average of 2.3% y/y in 2013 and 2.7% y/y in 2014.

Related Articles

Hungarian unions in full gear for first country-wide strike at Tesco stores

Union leaders are preparing for the first country-wide strike at Tesco stores in Hungary, which has unanimous support from workers, local media reported on September 4. This is just the latest in ... more

Russian development bank IIB signs off on debut Hungarian credit facility

The Moscow-based International Investment Bank (IIB) announced on August 9 that it has signed off on its debut credit facility in Hungary. The Russian-led IIB decided around five years ... more

Central Europe’s factories remain busy despite a summer lull in PMIs

Manufacturers in Central Europe reported a step back in activity and confidence in July, purchasing managers’ indices (PMI) released by IHS Markit on August 1 showed. While, the indicators still ... more