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BNP Paribas: On the doorstep of recession

The only driving force of economic growth in Hungary is export, but as external demand prospects are fading, Hungary could fall into recession, a leading international investment group states in a London report.

PNB Paribas, in an analysis entitled „Stagflation Fears” reports of slow consumption and investment activity in Hungary due to stringent fiscal and budgetary policy. This is the second report about the country in a short period of time citing stagnant growth along with high inflation. PNB Paribas maintains its prognosis of an interest rate drop up to 6.5% while Merrill Lynch predicted an even more aggressive 6.25%. The Hungarian economic growth outlook was modified to 1.8% from 2.2% by Goldman Sachs due to a slowdown of the eurozone and the domestic austerity measures. (Gazdasági Rádió)