Hungary’s new government has set its sights on introducing the euro as soon as possible, but economists warn that achieving this goal will require major economic adjustments. According to a new forecast by K&H Bank, the earliest realistic date for euro adoption is 1 January 2031, provided the country can meet strict European Union requirements on inflation and public finances.
The path to the common currency, however, may come with significant sacrifices, including slower wage growth and years of strict fiscal discipline.
Economy expected to recover after years of stagnation
According to K&H Bank chief analyst Dávid Németh, the Hungarian economy has entered a new phase after several years of stagnation that began in 2022, he told Népszava.
The bank expects economic growth of around 1.5% this year, accelerating to 2.5% in 2027 and reaching 3% by 2028. The recovery is expected to be driven by increasing consumer spending, stronger exports and a revival in investment activity, partly supported by incoming EU funds.
At the same time, economists caution that external risks remain significant. Rising global commodity and food prices, as well as higher oil prices, could put renewed pressure on inflation in the coming years.
Inflation remains one of the biggest obstacles
One of the key requirements for joining the eurozone is maintaining low and stable inflation. While Hungary’s inflation rate fell unexpectedly in May, economists do not expect the current favourable figures to last indefinitely.
K&H forecasts that annual inflation could remain around 3% this year, potentially dropping as low as 2.8%. However, inflation is expected to accelerate again towards the end of the year and could exceed 4% in 2027.
The timing of the government’s eventual removal of price caps and other market interventions will also play a major role in determining future inflation levels.
To align with eurozone standards, the Hungarian National Bank would need to lower its inflation target from the current 3% to the euro area’s 2% target. According to analysts, this would require a stricter monetary policy environment.
Wage growth may have to slow significantly
Perhaps the most sensitive issue for Hungarian households is the prospect of slower wage growth.
In recent years, average wages have regularly increased by 8–10% annually. In March 2026, net average earnings were 11.3% higher than a year earlier, representing real wage growth of around 9%.
However, Németh argues that such rapid wage increases are unlikely to be compatible with euro adoption, especially given Hungary’s relatively modest productivity growth. Maintaining lower inflation would likely require more moderate wage settlements across the economy.
Even with inflation expected to rise later this year, real wage growth could still remain between 6% and 6.5% by year-end, but analysts suggest that the era of double-digit wage increases may eventually have to come to an end.
Deficit reduction poses another major challenge
The second major hurdle is Hungary’s public finances.
Under the Maastricht criteria, countries seeking to adopt the euro must maintain a budget deficit below 3% of GDP on a sustained basis. The current government has stated that it inherited a deficit of between 6.8% and 7% of GDP from its predecessor this year, more than double the eurozone threshold.
Economists say upcoming fiscal decisions will be crucial. Investors and credit rating agencies will closely watch the supplementary 2026 budget expected to be submitted to Parliament in late August, as well as the government’s 2027 budget plans and medium-term economic strategy.
If these plans are considered credible and consistent with euro adoption, rating agencies could remove the negative outlook currently attached to Hungary’s sovereign debt rating.
Earliest euro target date: 2031
According to K&H Bank’s assessment, the government aims to fulfil the Maastricht criteria by 2030. If that objective is achieved, Hungary could realistically introduce the euro on 1 January 2031.
The forecast suggests that achieving this milestone will require several years of disciplined economic policy, lower inflation and substantial deficit reduction.
For now, Hungary remains outside the eurozone, but the government’s renewed commitment to joining the common currency has placed the issue back at the centre of the country’s long-term economic strategy.
What about the forint?
The forint has performed strongly in 2026, becoming one of the best-performing emerging-market currencies. Since January, it has appreciated by roughly 8% against the euro, second only to the Brazilian real among emerging-market currencies.
Analysts believe the current exchange rate of around HUF 355 per euro may represent the strongest level for the Hungarian currency this year. While the forint continues to benefit from relatively high Hungarian interest rates, expected interest-rate cuts by the central bank could reduce that support and lead to some weakening in the coming months.
For now, however, the road to the euro appears to be measured not in months, but in years, and reaching the finish line may require sacrifices from both policymakers and workers alike.
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