IMF: Hungarian economy will be a frontrunner in the EU next year

The International Monetary Fund (IMF) forecasts the Hungarian economy will be a frontrunner in the European Union next year, the Finance Ministry said on Friday.

The IMF expects strengthening economic growth, falling inflation and persistently low unemployment in Hungary, Finance Minister Mihály Varga said after participating at the annual meetings of the IMF and the World Bank Group in Washington, D.C.

Hungary’s policy of economic neutrality can preserve the improving economic outlook in spite of the uncertain international environment, he added. The IMF puts Hungary’s GDP growth at 2.9pc in 2025, the fifth-highest projection among the 27 EU member states. Varga said the IMF acknowledged Hungary’s work-based economy and its efforts to gradually reduce its fiscal deficits and state debt levels.

Photo: facebook.com/szijjarto.peter.official

Fitch points to policy ‘trade-offs’ in Hungarian stimulus plan

Rating agency Fitch said an economic action plan recently unveiled by Hungary’s government contained policy compromises between economic growth and fiscal consolidation in an analysis published on Thursday. “Hungary’s recently announced new economic action plan highlights policy trade-offs between fiscal consolidation and the government’s commitment to social support and growth performance targets,” Fitch said.

“It is unclear if the proposals will strengthen growth prospects sufficiently to reduce challenges to medium-term fiscal consolidation – challenges that could increase should a recovery of external demand lag,” it added. The government’s plan aims to raise purchasing power, create affordable housing and develop SMEs. Fitch noted that the negative outlook on Hungary’s BBB sovereign rating reflected risks around the policy environment and the performance of public finances.

The recovery in economic activity following last year’s GDP contraction will be an “important driver” behind forecast deficit reduction over the next four years underpinning a recovery of budget revenue, it added. Fitch puts Hungary’s GDP growth at 3.4pc in 2025 and 3.5pc in 2026.

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2 Comments

Gabor

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says:

27/10/2024 at 19:15

I have been searching and I couldn’t find any reference that backs up all (or any) of the statements the Prime Minister said. However, the headline says that IMF said so. Maybe I am not good at searching, so it would help including references in the article. Otherwise, someone might think that this is just propaganda framing the wishful thinking of the Prime Minister as an IMF official statement
Londonsteve says:

28/10/2024 at 20:50

Hungary to be a growth frontrunner according to the IMF? That’s clearly foreign funded marxist globalist nonsense from an organisation that’s part of the international liberal left movement. Oh, wait…..