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Analysts consider government growth and inflation forecasts acceptable

Analysts polled by MTI said the Hungarian government's revised economic growth and inflation forecasts are acceptable, though conservative.

Finance Minister János Veres said at a meeting of the National Interest Coordination Council (OÉT) on Friday morning that according to the government's revised macroeconomic forecast, Hungary's GDP will grow by 1.2% in 2009 rather than the earlier expected 3.0%, while the country's inflation rate will be 3.9% next year rather than the earlier expected 4.3%.

CIB Bank analyst György Barta said that the bank expects economic growth of 1.5% and an inflation rate of 3.9% in Hungary next year.

MKB Bank chief analyst Zsolt Kondrát said that it is difficult to estimate economic growth before the abatement and assessment of the financial crisis, adding that although the government's estimate is conservative, Hungary's economic growth might even be lower than 1.2% in 2009.

Dávid Németh of ING Bank also said the government forecast is realistic and meets the expectations of the market. Németh added that more expensive bank loans would reduce consumption, thus reducing the state's VAT revenue. Németh added that budget reserves may be used to compensate for this reduction. (MTI – Econews)