Szazadveg lowers GDP growth, inflation forecast for 2015
Budapest, September 22 (MTI) – Economic research institute Szazadveg has lowered its GDP growth forecast to 3.1 percent for 2015 from 3.4 percent forecast in June.
The economy was weaker than expected in the second quarter, the think-tank said, adding that the deterioration in the economic outlook is related to one-off factors which do not affect Hungary’s growth potential.
Economic output is expected to grow by 2.5 percent in 2016 compared with 2.7 percent earlier forecast, it said on Tuesday.
Annual inflation is reckoned to be 0.1 percent this year, lower than the 0.3 percent predicted earlier.
The institute said Hungary’s economic performance will be driven primarily by consumption and exports.
Purchasing power could improve considerably due to the low-inflation environment and improving labour market conditions as well as the reduction of the personal income tax rate and the extension of the family tax benefit, Szazadveg said.
Employment is seen falling to below 6 percent by the end of 2016.
Investments could decline in 2016 due to the closure of the previous EU financing period, the think-tank said.
The government’s deficit target of 2.4 percent of GDP is achievable, it added.
Source: http://mtva.hu/hu/hungary-matters
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