Central bank sees GDP shrinking 6.0-6.5 pc this year

The National Bank of Hungary (NBH) expects the economy to contract between 6.0 percent and 6.5 percent this year, forecasts from its latest quarterly Inflation Report released on Tuesday show.

The central bank had forecast GDP contraction of between 5.1 percent and 6.8 percent in the previous report released in September.

The Finance Ministry expects GDP to fall by 6.4 percent this year.

The NBH puts the average annual inflation rate for this year at 3.4 percent in the fresh report, below the 3.5-3.6 percent range in the September report.

The central bank forecasts a rebound to 3.5-6.0 percent growth in 2021, a little more muted than the 4.4-6.8 percent growth projected a quarter earlier. It puts GDP growth in 2022 at 5.0-5.5 percent and at 3.0-3.5 percent in 2023.

The bank’s forecasts for inflation show CPI at 3.5-3.6 percent in 2021. It sees CPI falling to 2.9-3.0 percent in 2022 before reaching the 3.0 percent mid-term target in 2023.

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