IMF lowers 2016 GDP growth forecast to 2 pc

Budapest (MTI) – The International Monetary Fund lowered its projection for economic growth in Hungary this year to 2.0 percent in its fresh World Economic Outlook published on Tuesday from 2.3 percent in the previous outlook released in April.

The projection is under the government’s official forecast for 2.5 percent growth.

Hungary’s GDP grew by 1.9 percent in the first half, the latest data from the Central Statistical Office show.

The IMF projects Hungary’s GDP growth rate will pick up to 2.5 percent in 2017, unchanged from the previous forecast.

The government targets 3.1 percent economic growth next year.

“Hungary is estimated to be growing faster than potential and is projected to return to more sustainable rates of growth over the medium term,” the IMF noted in the report.

The IMF forecasts consumer prices will edge up by 0.4 percent this year. The forecast was lowered from 0.5 percent in April.

Hungary’s current-account surplus is seen reaching 4.9 percent of GDP this year, down from 5.4 percent in the previous forecast. The surplus is expected to narrow to 4.6 percent of GDP in 2017.

The IMF projects Hungary’s unemployment rate will fall from 6.0 percent this year to 5.8 percent in 2017. In April, the IMF projected the unemployment rate would fall to just 6.7 percent this year.

Source: MTI