GKI: 2015 economic trends in Hungary uncertain


GKI research firm forecast a 2% GDP growth for 2015, down from 3.2% this year, the firm said yesterday. Slower than expected world economy growth, a fall in oil prices and tensions between the United States and Russia are the key external factors in Hungary’s slowing economy.

“The [government’s] overall objective is to reduce the general government deficit below 3% of GDP at any price and to avoid the resumption of the excessive deficit procedure in order to get access to EU transfers”, GKI said in a report published yesterday, adding that “reform of large redistribution systems based on objective criteria is missing”.

With an accelerating inflation of 2% and a similar growth of wages, earnings and real incomes will reach near stagnation in 2015, while consumption is expected to grow by 1.5-2% – the same rate as in 2014.

Risks identified by GKI include EU funds being partially frozen, uncertainties in the investment climate, falling internal and external demand across all industries, a more vulnerable banking system and underestimated government expenditures.

The “government debt trajectory is not credible and the resumption of the excessive deficit procedure based on the renewed legal rules concerning government debt cannot be excluded even if the general government deficit remains below 3% of GDP”, GKI added, while external balance surplus is likely to decrease. GKI expects that MNB will most probably tolerate the weakening of the exchange rate of the forint to the euro as long as the yearly average remains below HUF 320.


MNB Int'l Reserves Rise EUR 633 mln in November MNB

MNB Int'l Reserves Rise EUR 633 mln in November

MPs Approve Tax Changes Parliament

MPs Approve Tax Changes

Number of Job Adverts up Minimally HR

Number of Job Adverts up Minimally

Tourism Nights Down 0.2% y.o.y. in October Tourism

Tourism Nights Down 0.2% y.o.y. in October


Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.