Gloomy prospects: government calculates with 20% inflation

Mihály Varga, Hungary’s minister of finance, talked about the Hungarian economy’s gloomy future at a conference in Szeged. The PowerPoint presentation he used showed two charts already frightening enough. One was about Hungary’s GDP, and the other was about the expected inflation rate in Hungary.

Dark future

According to Magyar Narancs, inflation in Hungary will reach its peak in November and December. The figure then will be around 20 percent and is expected to remain at 15 percent even in September 2023. The stability of the prices may return by mid-2024 when the calculated inflation would be 3 percent again.

Regarding the Hungarian GDP, the prognosis is darker. The economy will be in a recession for four quarters meaning that Hungary’s GDP will decrease. The nadir will be in Q1 2023 and will increase again only by the end of that year.

Read also Hungarian minister of finance: EU’s euro billions ‘closer’

Budget deficit increases again in Hungary

Hungary’s cash-flow-based budget deficit, excluding local councils, was HUF 2,872.7 billion (EUR 7.1bn) at the end of August, the finance ministry said in a second reading of data on Friday. The deficit widened from HUF 2,636.5 billion at the end of July.

The shortfall reached 91.1 percent of the full-year cash-flow-based budget deficit target. The central budget deficit reached HUF 2,964.6 billion at the end of August. The social security funds were 144.2 billion in the red, while the separate state funds had a surplus of 236.1 billion.

Source: Magyar Narancs, MTI