GKI said it cut the forecast because of "Hungary's proximity to Ukraine, the uncertainty and probable delay in the arrival of EU transfers, overdependency on Russia and the hard-hit automotive industry, and extraordinarily high inflation and its dampening effect on consumption".
The institute acknowledged the economy would probably expand at a faster clip than the EU average.
GKI projects Hungary's industrial sector will grow just 2.5%. It puts domestic consumption growth at 2.2%.
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