Inflation in Hungary is 8th highest in EU

While inflation is on the rise across the whole European Union, Hungary is also experiencing a marked deterioration in its currency. The annual inflation rate in the euro area rose to a new record of 8.6 percent in June, up from 8.1 percent in May. Meanwhile, inflation in the European Union as a whole rose to 9.6 percent from 8.8 percent in May, Eurostat said in a report published on Tuesday, according to MTI.

Inflation in EU

Inflation in EU states in June 2022. Source: Eurostat / MTVA Press Archive / MTI

According to data from the EU’s statistical office, the rate of price increases in the euro area accelerated further for energy (42 percent compared with 39.1 percent in May); food, alcohol and tobacco (8.9 percent compared with 7.5 percent in May); and non-energy industrial products (4.3 percent compared with 4.2 percent in May). In services, on the other hand, the rate of increase eased marginally to 3.4 percent from 3.5 percent in May, Index.hu reports.

The lowest annual inflation rate was in Malta at 6.1% and the highest in Estonia at 22%. Inflation fell in only two of the EU’s member states, but rose in the other 25 in June. Hungary’s inflation rate is the eighth highest among EU countries, along with Slovakia’s.

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Inflation in Hungary

According to Eurostat data, annual inflation in Hungary – also based on the Harmonised Index of Consumer Prices (HICP), which is calculated for EU comparison purposes – was 12.6% in June, up from 10.8% in May.

According to Eurostat data, annual inflation in Hungary – also based on the Harmonised Index of Consumer Prices (HICP), which is calculated for EU comparison purposes – was 12.6% in June, up from 10.8% in May.

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Inflation forecast for 2023

The EU economy is forecast to grow by 2.7% in 2022 and 1.5% in 2023. The euro area economy could expand by 2.6 percent in 2022, but slow to 1.4 percent in 2023. Average annual inflation is forecast to peak at a historic high of 7.6 percent in the euro area and 8.3 percent in the EU as a whole in 2022, before easing to 4.0 percent and 4.6 percent respectively in 2023.

By comparison, GDP growth in Hungary will fall from 7.1 percent in 2021 to 5.2 percent in 2022 and 2.1 percent in 2023. Average annual inflation rises from 5.2 percent in 2021 to 11.8 percent in 2022 and remains high at 7.6 percent in 2023.

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Source: Index, magyarnarancs.hu, MTI, Eurostat