The European Bank for Reconstruction and Development (EBRD) forecasts Hungary's GDP will contract 0.2% this year in its latest Regional Economic Prospects, revised from a 0.4% growth in the May report.
"Weak external demand, tight financing conditions and delayed disbursement of EU funds, will likely result in a contraction of economic output, notwithstanding various government stimuli programmes," it said.
The forecast is in line with the analysts’ projections.
On a quarterly basis, output fell for the fourth straight quarter in the April-June period, the longest streak since 1995. Hungary's GDP shrank 1.7% y/y in H1.
Since Viktor Orban took power in 2010, Hungary only recorded economic downturn in 2012 and during the pandemic in 2020.
The EBRD sees Hungary's GDP growth picking up to 2.8% in 2024 on the back of recovering domestic demand.
Growth in the EBRD regions is expected to slow to 2.4% in 2023 from 3.3% in 2022. In 2024, as inflation continues to ease, growth is expected to pick up to 3.2%
In the Central European and Baltic EU regions, the EBRD forecasts average economic growth of 0.5% this year and 2.5% next year.
Don’t just follow the news—understand it.
The IntelliNews PRO service includes access to reports, exclusive market data, and more news that decision-makers care about. Stay ahead of the market with IntelliNews PRO.
Sign Up NowRelated Articles
Eurozone manufacturing growth hits four-year high in April but Middle East war drives record price surge
Eurozone manufacturing activity expanded at the fastest pace in nearly four years in April as factories rushed to build safety stocks ahead of expected price rises and supply shortages linked to the ... more
Druzhba oil flow to Slovakia and Hungary is renewed
The oil flow from the Russian Druzhba pipeline was renewed late on August 19. “The flow of oil to Slovakia is standard at the moment,” the country’s Minister of Economy Denisa Saková (Hlas) ... more
US Westinghouse could develop electricity storage site near Slovak Gabčíkovo hydroelectric power plant
US power company Westinghouse is reportedly in talks with the Slovak government to develop a new type of electricity storage site near the Gabčíkovo hydroelectric power plant (HPP) on the Danube ... more