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Századvég puts 2010 GDP growth at 0.8%, over gov't forecast

Századvég Gazdaságkutató projects Hungary's economy will expand 0.8% in 2010, slightly over the 0.6% growth rate forecast by the National Economy Ministry, the economic research company told MTI. Századvég sees GDP growth picking up to 2.8% in 2011. Consumption is set to grow 1.6% and investments 2.4%. The company projects Hungary's general government deficit will reach 4.0% of GDP in 2010, slightly more than the 3.8% government target. The deficit will narrow to 3.3% in 2011, according to Századvég, also over the 2.8% target in Hungary's convergence plan. Századvég expects the unemployment rate to improve only slightly in 2011 from over 10% in 2010. Average annual inflation is seen slowing from 4.7% in 2010 to 3.7% in 2011. Századvég expects the National Bank of Hungary to start raising rates in 2011. It puts the base rate at end-2011 at 5.50%, up just 25bp from the current rate. The company sees Hungary running current-account surpluses equivalent to 0.8% and 1% of GDP in 2010 and 2011, respectively. (MTI-Econews)