EC raises Hungary 2021 GDP growth forecast to 7.4 percent

The European Commission raised its projection for GDP growth in Hungary this year to 7.4 percent in an autumn forecast published on Thursday.

The projection was raised from 6.3 percent in a forecast released in July.

The commission also said rising production costs were keeping inflation high. It expects the harmonised consumer price index to peak at 6.7 percent in the fourth quarter of 2021 on the back of price hikes after the reopening of the economy and global commodity price increases.

The EC projects a 5.4 percent growth rate for 2022, level with its summer forecast.

It sees growth slowing to 3.2 percent in 2023 as output returns close to its potential and policy support is gradually withdrawn.

Last week, Hungary’s finance ministry lowered its projection for GDP growth this year to 6.8 percent from 7-7.5 percent against the backdrop of higher energy prices, inflationary pressure and the impact of the fourth wave of the pandemic.

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