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Jobless rate likely to stay in double digits till H2 2012

Hungary's average unemployment rate among 15- to 74-year-olds edged up to 11.6% in January-March from 11.5% in December-February, but inched down from 11.8% in the same period a year earlier, KSH said in the morning.

György Barta of CIB Bank said seasonal reasons were behind the higher rate. The rate is likely to fall in the coming months but will not drop under 10% before H2 2012, he added.

Barta warned that government measures to bring pensioners on disability back to the workforce as well as sectoral taxes introduced in 2010 could exert upward pressure on the rate.

Gergely Suppán of TakarékBank also put down the rise in the unemployment rate to seasonal factors. Changes to government-run public work programs also raised the rate, he added.

The rate is likely to fall to 10.2% in the summer before climbing to 10.6% at the end of the year, he said.

Erste Bank's Zoltán Árokszállási said the unemployment rate would probably start falling in the coming months and average out to 10.5-11% for the full year.