Economic research institute raises Hungary 2017 GDP growth forecast to 3.6 pc

Budapest (MTI) – Economic research institute Századvég on Tuesday raised its projection for economic growth in Hungary for 2017 to 3.6 percent from 3.2 percent it forecast in September.

The think-tank said in its forecast that next year’s growth rate will be lifted by the recently-approved payroll tax cut as well as minimum wage increases for both skilled and unskilled workers. The wage increases could result in a greater rise in households’ disposable income than previously anticipated.

Századvég said there were more uncertainties surrounding its 2017 forecast than there normally would be, adding that it could not rule out a growth rate of more than 4 percent.

Consumption is expected to grow by 5.6 percent, thanks to an increase in household incomes, compared with the think-tank’s earlier projection of 3.6 percent.

Wages are expected to grow by 10.7 percent overall and by 11 percent in the private sector.